IT Staffing Report: July 9, 2015

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Feds investigating firms for alleged H-1B abuse

The US Department of Labor is investigating IT services firms Infosys Ltd. (NYSE: INFY) and Tata Consultancy Services Ltd., over alleged abuses of the H-1B visa program, according to an announcement last month by US Senators Dick Durbin, D-Ill., and Jeff Sessions, R-Ala.

“We’re pleased to hear that the Labor Department is taking a first step to stanch this tide of visa abuse,” according to a statement from the senators. “A number of US employers, including some large, well-known, publicly traded corporations, have laid off thousands of American workers and replaced them with H-1B visa holders. To add insult to injury, many of the replaced American employees report that they have been forced to train the foreign workers who are taking their jobs. That’s just plain wrong and we’ll continue to press the administration to help solve this problem. We look forward to the outcome of the Labor Department’s investigation.”

The senators cited a Los Angeles Times story about Southern California Edison laying off some IT workers and replacing them with outsourced employees from India.

In a response, Tata said in a statement: “TCS maintains rigorous internal controls to ensure it is fully compliant with all regulatory requirements related to US immigrations laws, including those related to H-1B visas, and we are fully cooperating with this request for information.”

Infosys also responded with a statement: “Infosys is committed to complying with US immigration laws. The US Department of Labor regularly selects a percentage of visa and labor condition applications for extra scrutiny in this industry, and we work closely with the DOL to assist them in this activity in the ordinary course of our business.”

Nasscom, an organization that represents the Indian software industry, said the efforts appear to portray the Indian IT sector negatively without regard to facts and logic, according to a report by the Press Trust of India. It said Indian IT firms have made significant contributions to the US in terms of job creation and have helped maintain the global competitiveness of US companies.