Free Republic
Browse · Search
News/Activism
Topics · Post Article

To: Mr. Bird
The H1B holder is either a regular, full-time employee of the American corporation, or they are not employed in the U.S. Your scenario may be valid, but it is not described in accurate terms.

On the contrary, it is completely accurate. The way it works is this. A company (call it "Indian Consulting") hires H-1Bs. Thus they are full time employees -- of "Indian Consulting" -- which operates in the US as as US based corporation.

Other American corporations then post contract jobs where they need someone for 3 to 6 months as an hourly contractor. The contract is offered to "Indian Consulting", which then staffs one of their H-1Bs on the jobs. The American corporation has clean hands, legally -- the H-1B is not their employee at all. But once on the job they can continue to extend the contract, continuously, even for different work. This process is called "change orders". So they can in effect have someone who works for them for years, just like an employee would, but who is technically not their employee, but is rather an employee of "Indian Consulting".

However, the contract may be for $50/hour to "Indian Consulting", which then pays their H-1B employee an hourly wage as a "W-2" (not 1099). If for any 2 to 4 week period that H-1B cannot "get staffed" on a contract -- back to India they go. Cost to American corporation -- $100K per year; but they pay no Social Security, no health benefits, no 401K, no bonuses, no fringe benefits whatsoever, plus they can dump the person at any time and either ask for a replacement or simply terminate the contract. This is good business for the American corporation. No HR problems. No worries about being sued for any reason if they want to get rid of the contractor.

"Indian Consulting" violates a bunch of laws -- just spend some time talking with the H-1Bs. Mainly, they lie to the US consulate about having jobs lined up "that no American is qualified to do". They lie to the H-1Bs to get them on board. They pay them late -- sometimes 12 weeks in arrears. They make them take mandatory "training" and then deduct the cost from their salaries. All kinds of stuff -- these H-1Bs are taken advantage of in so many ways. Yet each one of them takes a job away from an American because no matter how low the American is willing to go for the job in salary, "Indian Consulting" can beat the cost. And remember -- the American corporation using the services of "Indian Consulting" likes it because they have a flexible labor pool. Need 10 people tomorrow? Just pick up the phone, no interviewing required, no paperwork at all. Need to lay off 30 people for a month to make the quarterly budget? Just pick up the phone, and whoosh -- tomorrow 30 less bodies show up.

86 posted on 05/18/2003 9:01:44 AM PDT by dark_lord (The Statue of Liberty now holds a baseball bat and she's yelling 'You want a piece of me?')
[ Post Reply | Private Reply | To 85 | View Replies ]


To: dark_lord
Thanks for the clarification. That makes sense.
88 posted on 05/19/2003 3:06:53 AM PDT by Mr. Bird
[ Post Reply | Private Reply | To 86 | View Replies ]

To: dark_lord
A step in the right direction would be for US companies to pay the missing overhead that H1Bs dont account for now. SS, medicare, workers comp et. al. That one equalizer in the law would make most companies conclude that it isnt worth the bother to import.
89 posted on 05/19/2003 3:19:45 AM PDT by doosee
[ Post Reply | Private Reply | To 86 | View Replies ]

Free Republic
Browse · Search
News/Activism
Topics · Post Article


FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson