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Justice Department Slaps IBM Over H-1B Hiring Practices

Posted by timothy on from the rules-from-above dept.

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."

6 of 195 comments (clear)

  1. Re:$44,400 fine -- That'll teach 'em! by Mitreya · · Score: 5, Insightful

    Yep, a whole $44,400 fine.

    Good thing they did not download an mp3 file illegally. Because that could have cost much more!

  2. H1B working as intended. by Delusion_ · · Score: 4, Insightful

    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.

    1. Re: H1B working as intended. by Delusion_ · · Score: 4, Insightful

      > Let's ignore for a moment that this visas mandate US level salaries

      Most of the problem isn't that we can ignore it, but that the companies in question as well as Congress does ignore it. The entire program only exists because it acts as a loophole by which employers can pay sub-standard wages, not competitive wages, despite what you might wish or the actual law might require before you get into the contingencies and loopholes. The biggest of these is that "competitive wage" is defined by occupation and region, not actual job function. You want a lead programmer at journeyman prices? Not a problem in the law.

      H1B visas are by law only allowed when there is not a US citizen with comparable skills at the local prevailing wage. The prevalence of H1B visas requires one to believe that the US job market is just so great that it's difficult for employers to find qualified applicants.

      As well as the advantages which directly affect the US wage:

      Off-the books overtime. Denial of legally required benefits. Hiring under one firm and working under another. These workers can be sent back the minute they cease to be a bargain.

      There are plenty of US workers for what are mostly entry-level programming positions. The companies don't want H1B visas because, in accordance with the intent of the law, they can't find suitable candidates at market value. They want them precisely because they want them below market value.

  3. Re: Are you F*cking kidding me!!! by Anonymous Coward · · Score: 4, Insightful

    A law that is not enforced is hardly a law at all.

  4. Re:$44,400 fine -- That'll teach 'em! by philip.paradis · · Score: 4, Insightful

    If investors actually pay any attention at all to this news, the price will go up. IBM has essentially proven to its shareholders that they can once again go up against the federal government in cases like this and come out paying virtually nothing in fines, while not being required to take any meaningful action as far as policy revision goes. That's called "enhancing shareholder confidence."

    You probably shouldn't have sold those shares.

    --
    Write failed: Broken pipe
  5. Re: Are you F*cking kidding me!!! by Dcnjoe60 · · Score: 4, Insightful

    Nonsense. Those visas mandate proper salaries (note that the article says nothing about this point)

    It still drives down wages. If there truly is a limited supply of skilled workers, then supply and demand dictates that wages will increase. As wages increase, more workers will enter the field and wages will stabilize. However, bringing in H1B workers keeps supply and demand from working, thus keeping wages down and discourages new workers from entering the field. Bring in enough H1B workers and now there are a surplus of workers and wages fall, maybe not ot third world levels, but below what the market would normally dictate.

    So ultimately, the OP was correct, H1B visas, because they disrupt the normal supply and demand flow for wages do indeed supress wages. While that is not the intended purpose of H1B visas, that is the practical effect.