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Justice Department Slaps IBM Over H-1B Hiring Practices
Dawn Kawamoto writes "IBM reached a settlement with the Justice Department over allegations it posted discriminatory online job openings, allegedly stating a preference for H-1B and foreign student visa holders for its software and apps developer positions. The job openings were for IT positions that would eventually require the applicant to relocate overseas. IBM agreed to pay $44,400 in civil penalties to the U.S., as well as take certain actions in the way it hires within the U.S. The settlement, announced Friday, comes at a time with tech companies are calling for the U.S. to allow more H-1B workers into the country."
Could the justice department do any less? The fines are a joke.
Yep, a whole $44,400 fine. That's got to sting a multi-billion dollar company. Bet they won't dare try that again.
If you're a zombie and you know it, bite your friend!
All they have to pay is a $44,400?! That's probably less than what they save in one year by hiring just one H-1B visa holder over an American citizen. The whole H-1B system is scam and should be scrapped entirely.
Wow they had to pay the savings realized on 1 whole engineer as a fine. I bet that will really discourage them and other companies from engaging in this type of behavior
The heavy hand of big government continues to stifle the economy. Just think how many jobs they could create if they still had that $44,400.
That fine is so small, it could be paid of of petty cash at a startup.
"Politicians are interested in people. Not that this is always a virtue. Fleas are interested in dogs." P.J. O'Rourke
The only wrong thing is that the 1965 Immigration Act was passed. Repeal that, remove the regulations from it, and tell the lobbying organizations that complain to EABOD.
By showing a preference for more despotic countries and locales over US citizens, businesses show a hate for freedom for anyone else that isnt one of them. They made the choice to use these countries instead of hiring in a more free US.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
IBM agreed to pay $44,400 in civil penalties to the U.S.
Well gee, why don't you make them switch the way the toilet paper falls over the roll as well, you fascists!
In addition, your own advocacy that the US citizen must pay for a choice of a business is absurd and un-American. The worst thing the US could do for its citizens is for the courts to not smite companies for doing these practices, to not take away all the ways to screw with workers(such as permatemping, 29ers/49ers), and not otherwise directly hire a US citizen in good faith.
The US does not bow to the world.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
We need IT unions now and better training Not more high cost schools that give you skill gaps.
I don't know if i should interpret that as a fine or a small bribe to speed up those H1B reforms as their stock overlords wish.
Why is it that free market principles don't apply to IT wages? If there is a shortage of IT workers, then salaries should rise.
The real "Libtards" are the Libertarians!
Just wrote something about H1Bs in a different post. Modified to be more relevant to this post:
Every time a company tells Congress they need more H1Bs, they're not telling you they can't find programmers, they're telling you they don't want to pay a competitive wage. Combine this with the fact that a lot of programmer types consider themselves too "individualist" to be involved with anything so "workmanly" as a labour union, and you set up a system where talented workers' wages are artificially reduced.
The result is a competent creative who is suddenly being pitted against people whose standard of living requires a third or less of the salary by a company whose primary interest isn't in being a good corporate citizen, investing in the community, or even playing by the rules that conservative and libertarian proponents pay lip service to, but increasing "shareholder value" by any means necessary no matter who suffers, and no matter how bad it is for the community, the region, and the country.
I've seen strip club tabs higher than that...
Karma: Bad
The jobs have left. There is a whole world of smart people who are now competing. The IT revolution has made knowledge and work transfer easier and easier. If it weren't for H1b's to complain about it would be the sound of jobs being sucked out of the developed world. Unions won't stop it. They might shift the playing field a smidgen.
Pittance!
Why even bother with such a 'penalty'?
the establishment parts of the Democrat and Republican parties have been bought-and-paid-for by big business (Republicans are always portrayed that way but Obama got far more money from Wall Street than McCain did) and big business only believes in the "free market" when it works in their favor. When there's a shortage of something they raise prices and say "we're not to blame...it's just the free market" but when a shortage of workers exists and prices should rise they get congress to let them break free of the free market by importing workers and/or exporting the work (i.e. the labor is provided in a different market with different rules and economics). When the time comes to import finished products back into the country, of course, they go back to supporting "free trade and free markets" as they demand "no tariffs".
Wanna fix this? Get politically active. Demand that your member of congress attach severe penalties (years in prison and seizure of assets) for the executives of any company that uses H1B labor when there are US workers available. When the jerks complain that this would be unfairly severe, point out that nobody would actually be subject to such penalties if they are not, in fact, abusing the H1B system (which these business execs always swear they are not). The public needs to demand that these business men get their bluffs called... When a CEO says "we don't use H1B visas to push down wages" the response should be to shove a pen into his hand and get him to sign-on in support of draconian penalties for any executive who does ... after all, it would help the "good" CEO by punishing his "bad" competitors ;-)
Revelation: The problem is the cycle of immediate profits (H1B program) followed by eventual decline due to lack of quality. So short-term profits (yay, high fives and bonuses for execs) followed by inevitable plunge (golden parachutes for star execs!)... Then repeat the cycle. It's the executive class, they are in charge of continuing this cycle of gain/decline that benefits themselves. With a gain, there's more expectation, that's bad, so a purposeful decline.. execs churn between companies as a result, making boatloads of cash. Rehire quality developers short term, until gain is achieved... Replace with H1B's, repeat cycle.
The Lehman Bro's couldn't agree with you more. And Bernie Madoff thinks so to.
Both the summary and some commenters make the same huge mistake by putting IT people and programmers in the same bucket. A C++ programmer has completely different skills and responsibilities from a PHP/HTML programmer, who has a completely different job from a network/system administrator. The latter could be considered IT (and their pay is usually lower), whereas the former are developers (requiring extra creativity and more skill, and are better paid). In my experience working in the Bay Area, there really is a shortage of competent high-skill systems developers/programmers (the kind of guys who design Google and Facebook infrastructure, like Big Table), but not a shortage of PHP or Java programmers or sysadmins.
is to give companies the opportunity to hire hard-working, creative, brilliant, polite, mature people, instead of lazy, whining, average intelligence, rude, socially inept children.
Well, at least SOMEONE is actually getting hired. I suppose that's better than just sitting on money and waiting for the whole world to implode. I would prefer a more progressive world, but beggars can't be choosers, now can we?
44k wow that's a lot of money to a little company like IBM. They're sure to change their ways now. Thanks, Justice Dept!
Unions in the USA all crawled into bed with the Democrats decades ago
Specifically, unions started really supporting Democrats in the 1930's, for a very good reason: The Democrats had just passed the National Labor Relations Act, which among other things gave unions the legal right to exist. For the 50 years or so before that, union leaders were operating under the constant threat of being beaten to a pulp or shot by company goons, and the unions tended to put their political support not behind either Democrats or Republicans but instead behind Socialists.
The Democratic Party continued to support organized labor up until the late 1980's or so, when they decided that the unions were basically a lost cause, and Bill Clinton abandoned unions in favor of corporate funding of the Democratic Party. Unions have never recovered either the political clout or the membership and funding they once had. And totally coincidentally, a worker today makes less (adjusted for inflation) than they did in 1987, despite the fact that the current American worker is more productive than any other worker that has ever existed on the planet.
I am officially gone from
H-1B visas need to be restricted even more. Companies are seriously abusing them. They are hiring people out of the US, importing them on those visas, training them here then sending them back overseas to do the work. Companies are using this to skirt the ITAR restrictions. If engineers did the work in the US some of that work would be ITAR restricted but if it's done overseas then it's not as restricted. Companies are employing farms of engineers overseas now.
Their claim of not enough qualified people in the US is bogus. Companies are just using this as an excuse to suck more money and jobs out of the US.If they can't find qualified people in the US then they should search for people who have potential then sponsor their education thru student loans that are repaid by the company if the person works for them. This would give the employee an incentive to stay with the company at least until the student loan is paid off. The reason why companies don't do this is they don't like to think that far down the road as to what their needs will be. They like instant gratification.
*It's not what you can do for the Dark Side but what the Dark Side can do for you!*
ALL of those things would apply to an H1-B as well. 100%. So it's not that.
It's just cheap labor conservatives up to their dirty tricks again.
All that will happen is that IBM will take those jobs overseas. It amazes me how many nitwits in tech think they are irreplaceable. The comment section of Slashdot is full of them.
Anyone working at Walgreens HQ in Lincolnshire or Deerfield? Absolutely sickening. If you are there, you know what I mean.
I would preferentially hire someone from India for a US job that would eventually relocate to India too, or wherever the job was meant to be. This is actually the best use of an H1B I can think of rather than flooding the market with more Chinese engineers. Most of the studies I have read seem to imply that there is no real shortage of talent for just about every technical profession.
That is, in IBM's mad rush to eliminate 100% of all US employment (except for executives) by 2015 they, admittedly occasionally, offer a devil's bargain to US based employees being cut: relocate overseas on your dime to take a job at CURRENT LOCAL wages and you get to keep your job.
Makes you wonder how much longer IBM will be an American company, legally. They may as well re incorporate in India or Ireland at this point. 50,000 regular full time employees in the US and dropping. Most new jobs going to low skill contractors. And the funny thing is that IBM routinely comes up in surveys as not one of the companies one would want to work for - not because it's a bureaucratic meatgrinder run by spreadsheet wielding accounts but because there's simply very very few actual jobs at IBM in the US anymore. If you're not an executive then you're either a recent college grad who might stay for 3 years or less or you're an old timer hanging on for dear life. There's nothing in the middle of that any more. There's basically zero IBM employees between the ages of 30 and 50. And the 50 year olds aren't going to 'share' their experience with anyone else, it's too risky. They've all become 'program managers' which is a fancy way of saying a staff job that consists of reporting the status reporting of status reporting of metrics of status reporting and creating new processes to report on the status of that.
DOJ didn't slap them, it was a mild tickle!
The US does not bow to the world.
Unfortunately it doesn't bow to its citizens either.
OSHA and environmental regulations are the job killer in the US.
Right, better we should let people get killed on the job and pollute the environment with abandon. Works in China! Meanwhile, Germany has worker safety and environmental laws much tougher than the US, yet they are a major industrial exporter.
It's just cheap labor conservatives up to their dirty tricks again.
Aided and abetted by cheap labor "liberals". I say this as a liberal. Being a "liberal" in politics these days means accepting gays in the military (a good thing) while shafting people who are trying to earn a living. Billy Clinton's "third way" means acting all open minded while working almost as hard as the conservatives to screw the average person.
Startup? I could pay it by taking some money out of my 401k.
"IBM agreed to pay $44,400 in civil penalties to the U.S"
And yet that's the fine for about two songs if you're a regular person.
I've got better things to do tonight than die.
Seriously. Everyone loves H1-Bs exception tech workers. What do you do when both parties are completely in favor of it? You can't say "Go to the Libertarians" either because they're in favor too (they're against amnesty usually, but want more legal immigration and visas).
I don't think we've got a chance. I remember reading an article from some University economist or something where he talked about how we're all going to have to get used to a lower standard of living and a more "Fragile" existence. I'd love to believe that's not true, but heck, we still blamed Unions for Hostess going under. We blamed 'em for GM and we're blaming weak test scores on them. We can't stop fighting amongst ourselves, how do we protect our livelihoods?
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
So because Democracy can be subverted with money we should do away with it and switch to Fascism? Unions exist for a reason. That reason has not gone away. The rich are still power hungry and still want us to fight amongst ourselves to increase their power. 55 years of mostly OK life in America (if you're not Black and in the South) has not changed 2000+ years of people being awful.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
H-1B does displace American workers. The greater problem is that its a training ground for one more business platform to be moved to India. If you go back and read the article it said they would eventually relocate there.
When you move platforms overseas you not only take programming jobs but you also take DBA positions, sys admin positions, networking positions, etc. Most of these platforms are lines of business support or customer support so all those positions evaporate as well.
First it was manufacturing, now technology and knowledge services. What's left? McDonalds?
If unions are such a bad thing, then why is Germany doing so well while the US economy sucks (especially in context of salaries, employment (real figures), and salary spread)? The unions in Germany had a part in it in conjunction with a real healthcare system for everyone and the anti cyclic measures taken during the last crisis. Unions can help to guarantee same salary for similar jobs forcing companies not compete by lowering salaries, but to be innovative in their products.
I had to go to TFA to verify that the number in the summary wasn't a misprint. $44K is couch-cushion change for IBM. It's so far down in the noise that it can't be detected. "slap on the wrist" doesn't even apply -- this is a mild threat to make a motion that might be construed as just missing slapping the wrist.
There needs to be more teeth in these penalties. (I know, "duh".) My company is hiring developers, and my manager came out and said to the department that they're going to give preference to foreign visa applicants to maximize budget effectiveness. (Or weasel words to that effect.) It was absolutely flagrant. They have no plans at this time to dump the current locals, but made it quite clear there wouldn't be any more of us.
Anonymous coward, because I don't want this tracking back to my job.
Outsourcing is a much better deal, it keeps the employees in their native economic and regulatory environments. It's a shame that the medical industrial complex is so powerful; monetizing the patient rather than local healthcare monopolies could save the public a lot of money.
Ed has said (at the recent conference) that their policy should they win the next election for the UK if you bring in some one on scarce skills visa the company would have to fund a matching apprentice possibly something similar should be done for h1b's
My understanding is that this year IBM India for the first time has more employees than IBM US. Think about that for a moment.
401k? I could pay it by taking some money out of my checking account.
mandate that the salaries be set to $500,000/per year U.S. currency, and grandfather all of the current H1Bs to that salary level immediately. Basically, all H1Bs start at $500,000 today, and remove any lock-in requirements. If companies are claiming these individuals are the best and brightest, they will easily fork over that money. If they are using the program to import cheap labor, then we will see what the fall-out is.
if they truly believe in "supply and demand" then they should see nothing wrong with this. If they are faced with a demand, and their choice is to either pay this for an H1B or raise the offered salary a bit to attract one of the many thousands of un-/under-employed IT people in the US they will be in the same spot as their competitors. The idea that this would hurt them because their competitors are in India is a joke; name one piece of commercial software provided by an Indian firm that the average American user or business has installed on his/her system.... (cricket sounds)
EVERY big American corporation that uses H1B visas and squeals about salaries is rolling in cash every time it negotiates executive salaries and benefits. Hell, many of these companies have spent millions of dollars bribing bad executives to go away (in most cases the bad management could have been just as exceptionally bad for a lot less (pay some bum $20,000 a year to screw-up...))
Except give an American their requirements to take the job.
Eh. I used to be a libertarian too. Let me introduce you to the Dark Enlightenment.
We've got this whole cheap programmer thing down pat in Ireland. Much cheaper than India, I would think. There's a national scheme called "Jobsbridge", which is used to fill all sorts of positions, from waiters to software architects. If you're currently out of work you can be assigned a mandatory 18 month position in a company. The company pays 1.675 dollars per hour for your time. Yes, you read that right. Failure to take the position can result in loss of all welfare payments. I'm too paranoid to say any more but..I'm seeing senior development positions being filled at this rate. Doesn't inspire confidence in the future when you're drawing down 20 or 30 times the salary for the same work...
The $44,400 fine is not even a slap on the wrist. Not exactly a deterrent to other companies engaged in such activity.
"Those visas mandate proper salaries" that are typically 12% to 35% below local market compensation for the particular kind of job. This isn't me claiming this; this is what the VP of Tata claimed, what Singh said, and what numerous researchers examining what sketchy data are publicly available have found repeatedly over the last 15 years and more.
USA is concerned about the creeping/uncivilized Caste system due H1B/Immigrants from India.
Google "Companies ruined or almost ruined by Indians".
If unions are such a bad thing, then why is Germany doing so well while the US economy sucks?
Bad example. Germans are so disciplined, they can make almost any bad system work.
They probably could have made communism work, if the Soviet Union had left them to their own devices.
"Once we've identified and embraced our sickness, we'll have strength...and that's when we get dangerous." - John Waters
What we need is IT unions IN OTHER COUNTRIES.
Great idea. If only the typical American programmer was socialist by nature. Then they could go to these countries and do some "organizing".
Unfortunately for this idea, most of the programmers I've met in my life are far from socialist...they tend to be anarcho-capitalist.
"Once we've identified and embraced our sickness, we'll have strength...and that's when we get dangerous." - John Waters
Guys & Gals, you have missed the salient point that IBM is NOT missing: the DOJ will monitor IBM's hiring for 2 years. According to their press release, "IBM further agreed to revise its hiring and recruiting procedures and train its human resources personnel to ensure compliance with the INA, and to be subject to reporting requirements for a period of two years."
Essentially, DOJ put IBM in a 2 year "EEO Re-hab" program. The DOJ can conduct random audits on IBM, inspect their offices, interview witnesses and examine business documents, and compel them to produce compliance reports for the next two years.
Avant Heathcare posted 100 discriminatory want ads and was fined $27,750 for doing so. I suspect that DOJ found more than 100 want ads but can't confirm the number since the fines are almost twice what they levied Avant Healthcare.
http://www.brightfuturejobs.com/avant_healthcare_florida
Donna Conroy, Director
http://www.brightfuturejobs.com/in_the_press
BM is STUFFED with Managers Who like to CONTROL decisions in a manner that benefits them personally rather than in the interest of the project. . .
They CREATE work out of nowhere and push themselves onto pretty much any client. E.g. they would contract operations support fix bid contract with Wellpoint or EDI for $1 million. When this happens , full time personnel in that place will be laid off. This happens in total connivance with managers at the Client site with IBM managers. Sometimes IBM pushes their own âconsultantsâ(TM) to work as full time staff
with the end client. The managers so hired at e.g. Well point will then be instrumental in
Getting âoeIBM insideâ
Once IBM âoeis inâ. Next step â" is to âoepush their productâ as a cheaper replacement
for an existing product. At least that is what is apparently said â" but of course their
âinside pullâ(TM) with the âoeclientâ gets the product inside. None of this has a telephone or email trail â" its done almost Exclusively over lunch meeting around client site. So initially IBM came there to reduce operational costs for the next 5 years on a fixed bid of $1million and they got another contract for $2 million for their product. This will be at the cost of further layoffs at the client site. Finally there will be a stage â" where ENTIRE I.T operations of a client are totally in hands of IBM. I have seen such clients â" I.T. totally outsourced to IBM
Its does not end there â" IBMâ(TM)s hiring practices US for consultants are some of the most .
debauched . A lot of IBM staff is on visas and the rest of the consultants from US are âhand pickedâ(TM) by the managerâ(TM)s âoetoucher magiqueâ . These visa people know their work well ( for the most , but exceptions are easy to spot ) but are at the mercy of managers who control them like dogs on a leash. Theyâ(TM)d tell them where to stay , what to eat , how much to spend and whatâ(TM)d be the color of their underpants. I PERSONALLY know of an IBM employee who hadnâ(TM)t a strong background for the kind of work she was doing and I wondered what the connection was with her being there. I worked for another company at that time and they booked us into the same Holiday Inn. I would see her van ride pull up every other night and she âd be back at 3, sometimes in the managerâ(TM)s Lexus
A recruiter for a prominent IBM vendor ( these are partner companies that hire consultants for IBM for IBMâ(TM)s end client projects ) told me that IBM managers will collect resumes for formalityâ(TM)s sake- they get tossed into shredders âeven before they âd be receivedâ(TM) â" if one would say . In reality they dictate the choice of candidate via âoepass through recommendationsâ . These âoepass throughsâ are based on a personal relationship to the candidate of course , but often times , there is a kickback from the vendor to IBM. Typically for the latter situations the consultants is one who is willing to get horribly low balled on his rate
E.g. market rate for a Filenet / JSP / Struts Java Architect is $90 / hr. The IBM manager will âchooseâ(TM) a willing candidate who can work at $30 / hr. Heâ(TM)d tell the vendor to collect resumes for this IBM position and ALL THE EXPERIENCE from those resumes is now transferred (== copy pasted ) to that of the novice whoâ(TM)s willing to do $30. $40 from billing goes to the IBM manager. IBM charges $120 for him at the client site. Of Course this novice does not know squat about hibernate or Filenet . Since he knows heâ(TM)s zero â" his existence on that job depends on shining the managers shoes and the manager likes to take his dog out for walk every morning. Itâ(TM)s a nice master pet relationship till it can go on.
At this point most folks will be cussing IBM , ah ..look its those Indian Managers.
But I can tell ya from my