H-1B Visa Lottery: End Of Another American Gold Rush?

Posted by Ranjeet Menon in GlobeScope, Politics
May 16, 2017

Even though the din over the H-1B visa saga is growing louder, the accusations against three Indian multi-national corporations (MNCs) seem to be a bit over-the-top to me. I am not trying to exonerate them in any way – they have indeed played their part in deteriorating the situation – but they are not the only ones involved.

I believe that the US government itself has diluted the true purpose of the H-1B visa. The objective of the H-1B visa is to help American MNCs recruit and employ skilled people from around the world to work on American soil.

Now, which are the companies that fit into the category of American MNCs? Apple, Google, Facebook, IBM and Microsoft are the names that first come to mind. Do these companies need to bring in 65,000 people every year from abroad to work for them in the US? Only fresh applicants and the ones whose previous visas have expired account for the 65,000 visas issued every year.

The lifespan of the visa is three years, and at any point in time, 130,000 active visa holders are already out there in the market, on top of the 65,000 visas issued every year. It would be unbelievable to even imagine that American MNCs would bring in so many workers into the country every year. If this is the case, what will happen to the employment market for local people? Even then, Bill Gates and many other IT corporate honchos have been openly advocating an increase in the number of H-1B visas issued. So, if the American MNCs are not getting a substantial piece of the pie, then who are the demons gobbling up the visas?

At the moment, I am a bit unsure about the definition of an MNC. Top American companies have operated in the US for many years before they expanded their reach to other countries. Indian companies operating out of India register their companies in the US and become MNCs – is it just that easy?

Why is it not required that a company have a pedigree and legacy of operating out of its parent country for, say 10 years, in a given industry, before being allowed to set up offices in a foreign country? Why don’t they have to provide proof of being ‘profitable’ companies, before setting shop in foreign shores?

More importantly, why didn’t the US government set up a different ‘visa quota’ system for American and foreign MNCs? With due respect to everyone and without being racist, I don’t think a company registered in the US, solely with the intention of outsourcing work from the US to the native country of the founder/stakeholder, should be given the status of an MNC at all. Why didn’t the US government strictly ensure that Indian MNCs paid their other workers the same salaries as was paid to the local employees in the US? Indian MNCs have made mountains of money by paying a fraction of the salaries that they should have.

However, Indian MNCs cannot be blamed (or held accountable) for what Theo Negri experienced. Neither do these MNCs pose a real threat to the visa system. More often than not, Indian MNCs ensure that they carry out sufficient background verifications (or checks) of the employees before they hire them.

Are tough times up ahead for Indian MNCs in the US?

However, there are plenty of devious companies that don’t do this. They don’t hog the visas – but the damage they do to the credibility of the visa system and its applicants is enormous. These companies have offices in the US. They hire people from India on their payroll. Then, they take them to the US on a contract to work for them. People have to pay a lot of money to these companies to get their visas, and then, they are tied down for at least two years on bonds to work on the company’s payroll. Contracting can happen through several intermediate companies with the effect that the employees are paid a minimal in-hand salary. Afterwards, it becomes an uphill task for the employees to recover what they spent on these companies.

These body-shopping companies develop excellent knowledge of the US market requirements. Moreover, they know how to showcase the resume of potential candidates that fit the job requirements. Bloated work experiences, skills and even fake certificates are said to be the usual methods employed by these companies. They even allegedly know the cities people prefer to fly to in the US at any given time (the ones where border-entry norms are a bit lenient).

Some Indian MNCs have also allegedly misused other types of work visas like the L-1 and the B-1 visas. How did this blatant misuse of the US work-visa system continue for so many years? How is it possible that these companies openly flouted the country’s laws? How do body-shopping companies know which city to be used as a ‘port of entry’? Why did the US government allow the visa system to be manipulated so badly that people with below-average skills could enter the country and get employment?

There must be a lot more at play here than what is visible. It is possible that the powerful Indian lobby in the US kept the entire visa system at bay by keeping all the stakeholders happy. After all, the amount of money involved here is monstrous. One day, I was wondering one day about the number of people who apply for a particular US visa every single day. They all have to pay the visa application fee. Many of the visa applications get rejected as well, but the application fee is not refunded. How much money is the US government making each day simply from the visa application fees obtained from around the world? It is staggering!

Attracted by the green card, the world ended up believing that the US is heaven-like for the new world. From the time the Europeans landed on American soil, people have had to toil really hard to make the America of today. However, life isn’t much different elsewhere in the world. After all, we all need to toil hard to progress in our lives.

The higher value of the dollar and the status symbol of an American identity are the two things that drive many Indians to the US. However, this ‘gold rush’ had to stop sometime. I saw this coming in the aftermath of the 2008 economic meltdown. I am surprised that it lasted this long!

A version of this post first appeared on the author’s personal blog.


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