FW: it's the wages, stupid

Date: Sunday, August 25, 2002 10:23 AM

*** H-1B NEWSLETTER ***

Get the Facts on H-1B at
www.ZaZona.com

This newsletter is forwarded from Norm Matloff. The situation described for
R Systems is very similar to Silverline in Arizona. These companies benched
their H-1Bs without pay and that is illegal. In Silverline's case they shut
down and moved back to India to avoid prosecution.

-----Original Message-----
Date: Saturday, August 24, 2002 11:56 PM

The subscriber list for this e-newsletter consists of affected parties
(programmers and engineers) and interested parties (journalists,
researchers, government staffers, etc.). Among the affected parties, I
receive on an almost daily basis e-mail with various ideas on how to
convince Congress that the H-1B cap is way too high. Most of these
ideas are valid, and many are ingenious, but almost all of them are
too complex for members of Congress and their staff, many of whom did
not consider math their favorite subject in school.

There really is only one point that need be made: H-1Bs provide the
employers cheap labor. It is simple to understand, and it is FACT,
established by several university studies, the DOL audit and most
significantly from Congress' point of view, by Congress' own
commissioned report. This is not an abstract concept that can be argued
back and forth; it is FACT, and nothing else really matters.

The enclosed article is a beautiful illustration of this point, as it
states that most of the H-1B programmers at this firm make around
$48,000 (which by the way is confirmed 's H-1B database).
Recall that the average programmer salary nationwide is $66,000 and even
new graduates make over $50,000.

R Systems' employment Web page says that they have the "best-qualfied
and talented professionals," all with hot skills ("C, C++, VC++
Programmers; Web Programmers/Developers; Multimedia Programmers,
Designers, Artists; E-Commerce (CGI, Perl, Java Scripting, Java Beans);
Oracle 7/8, Developer/Designers 2000; Pro*C All ERP packages; ...") --
for $48,000 a year.

So, the central issue is cheap labor, period.

The industry lobbyists have various arguments that can easily be
dismissed by once again bringing the focus back to this issue of low
wages. For example, the ITAA claims that even in this slow economy H-1B
are needed because they have very specialized skills. Well, if so, they
should be paid *high* wages, yet they are paid low ages. Other industry
lobbyists claim that they H-1Bs are world's "best and the brightest." Well,
again, wouldn't the best and the brightest be paid *more* than
American, rather than less? The industry lobbyists say the H-1Bs come
from countries in which kids have better math test scores than American
kids. Well, once again... You get the idea.

Norm

http://www.sacbee.com/content/news/story/4113058p-5135794c.html

Probe may focus on visa workers

Staff may have been 'benched' without pay at a foothills software company.

By Andy Furillo -- Bee Staff Writer
Published 2:15 a.m. PDT Saturday, August 24, 2002

A federal investigation into an El Dorado Hills computer software
company appears to be focusing on whether the firm complied with a
relatively new immigration law designed to protect foreign high-tech
workers from getting underpaid.

The probe of R Systems Inc., according to the company's former director
of immigration, is trying to determine if the firm engaged in a recently
banned practice in the technology industry known as "benching."

Until it was outlawed last year, foreign workers allowed entry into the
United States on H1-B visas could go unpaid "on the bench" for months at
a time during periodic business downturns. Regulations enacted by the
U.S. Department of Labor in January 2001, however, require employers to
pay workers for non-production time if their layoffs were due to company
decisions.

In a written statement, R Systems spokesman Steve Bluett said the firm
"is fully compliant with the rules and regulations as they relate to
paying employees." But the company's former immigration director, Ellen
Zenobia, said she and scores of other past and present R Systems
employees have been interviewed by a Labor Department investigator
researching a complaint suggesting that the company had violated the new
no-benching rules between May 2001 and May 2002.

"Essentially, that was one of the questions I was asked during the
interview I had with the investigators -- were there periods of time the
consultants were not getting paid?" Zenobia said.

Zenobia said it appeared to her that there were significant stretches of
time in which the foreign workers went without pay. A clause in the new
federal labor regulation, however, allows companies to "bench" foreign
workers if the down time is a result of their own choice, such as taking
a personal leave.

Whether the employees stopped working by company decision or their own
accord, Zenobia said many were sidelined for months at a time and that
they "then got terminated." Workers with H1-B visas were mostly from
India and were paid about $48,000 a year, Zenobia said.

Zenobia worked as R Systems' director of immigration until earlier this
month. The company said it replaced her because it was "outsourcing" all
of its immigration-related work. Zenobia said her termination from the
$42,000-a-year job came "out of the blue" and that she is thinking about
hiring a lawyer.

She said R Systems officials asked her to provide them with a copy of a
written statement she provided to the U.S. Department of Labor. She said
she refused. Bluett, the company spokesman, said in a statement that R
Systems employees "were under no compulsion or obligation to share
conversations or statements they gave to the DOL."

Spokespersons for the U.S. Department of Labor in San Francisco have
declined to comment on the investigation other than to say it involves a
wage-and-hour complaint.

The probe is believed to be the first federal "benching" investigation
in the Sacramento area. "It's the first I've ever heard of," said Ann
Kanter, a 27-year immigration lawyer in the region.

Benching was outlawed by the American Competitiveness and Workforce
Improvement Act of 1998, which amended the H1-B visa program under which
foreign professionals are allowed to work temporarily in the United
States at prevailing wage rates. However, Department of Labor rules
implementing the no-benching law didn't go on the books until January
2001.

If R Systems is found to have benched workers illegally, it would be
required to give them back pay and might face monetary penalties. Such a
finding also could affect its ability to hire H1-B workers in the
future.

The Labor Department does not have any figures on citations it has
issued to companies for benching workers. But Sam Udani, the publisher
of ILW.Com, a New York-based online immigration information
clearinghouse, said his publication is receiving reports of complaints
coming in at a rate of "one or two a week" nationwide.

R Systems is a software developer with a client list of more than 400
companies, including corporate giants such as General Motors and
Hewlett-Packard. It also has won a number of state contracts, including
the program it fashioned that provides updates on sex offenders who are
registered on the "Megan's Law" database with the Department of Justice.

It reported revenues last year of $34 million and has about 520
employees worldwide, including 47 on staff at its El Dorado Hills
offices, according to Bluett.

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