Sun Micro/"60 Minutes": Poetic Justice

Date: Wednesday, March 19, 2003 3:18 PM

H-1B and JOB DESTRUCTION NEWSLETTER

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Here is another article that discusses the class-action lawsuit against
Sun Microsystems. As many as 2,400 ex-Sun workers may be involved so
this is a huge lawsuit. Considering the size of this lawsuit you would
think that it would be all over the California newspapers, but that's
not the case. So far the newspapers are keeping the lid on this story.
Perhaps they have some Sun stock to dump first.

There is a sweet irony in what is happening because that awful "60
Minutes" story on Bombay University (IIT) will be used in the lawsuit.
View this excerpt from "60 Minutes" and you will see what I mean:

LESLEY STAHL:

Vinod Khosla got into IIT about 30 years ago. After graduating, he came
to the U.S., co-founded Sun Microsystems, and became one of Silicon
Valley's most important venture capitalists. He's one of thousands of
IIT graduates who've made it big in the U.S.

How significant would you say the impact of IIT graduates has been on
the American technology revolution?

VINOD KHOSLA:

It's far greater than most people realize. Microsoft, Intel, PC's - Sun
Microsystems - you name it, I can't imagine a major area where Indian
IIT engineers haven't played a leading role.

LESLEY STAHL:

Leading role?

VINOD KHOSLA:

A leading role. And of course, the American consumer and the American
business in the end is the beneficiary of that.

LESLEY STAHL:

It isn't just high tech; the head of the giant consulting firm McKinsey
& Company is an IIT grad, so is the vice-chairman of Citigroup, and the
former CEO of US Airways. Fortune 500 head hunters are always on the
lookout for that IIT degree.

VINOD KHOSLA:

They are favored over almost anybody else. If you are a Wasp walking in
for a job, you wouldn't have as much pre-assigned credibility as you do
if you're an engineer from IIT.

LESLEY STAHL:

Ninety percent of IIT students are male, and the young men we met in
Bombay know they're hot commodities. The American companies love the
kids from IIT.

In that interview Khosla flat out admits that Sun prefers Indians from
IIT, and of course most IIT students in this male dominated society are
almost exclusively young men. Lesley Stahl adored Khosla too much to
question his bigotry or arrogance. His racist comments about WASPS
would have caused an uproar if they were made about any other minority
group, and it's puzzling why the National Organization for Women isn't
all over Stahl for that statement on how those IIT males are hot
commodities.

Vinod and his "frat girl" interviewer Lesley Stahlor, probably never
imagined that this interview would be cannon fodder for the lawyer
handling the lawsuit. During Guy Santiglia's court hearing Sun totally
denied that they preferred H-1Bs, but they admitted that they
understand that if they did, it would amount to discrimination. Here is
a choice quote:

http://rss.com.com/2100-1017-978104.html?type=pt&part=rss&tag=feed&subj=news

Sun spokesperson Diane Carlini said the company didn't
take national origin, visa status or salary into account
in cutting its work force from about 42,000 to 35,000
beginning about 18 months ago. To have considered national
origin or visa status would have amounted to
discrimination, she said.

Carlini was referring to Guy Santiglia's complaint in the article below
when she said that Sun has been cleared of similar charges that its
H-1B practices violated labor laws. "It seems similar to what we've
seen in the past where we have been cleared." There is one thing that
isn't similar, this class-action was filed by a very skilled attorney
by the name of James Caputo. You can bet that Carlini will be working
overtime on her next bit of spin doctoring because this Caputo will
have Sun sweating.

Obviously Sun has a policy of preferring IIT grads because they are
Indian. If they were truly superior students this might be justifiable,
but here is a point of view that "60 Minutes" doesn't care to air:

Dr. Norman Matloff is probably too kind to IIT, but here is his
assessment:

As I said at the time of the 60 Minutes broadcast,
the IITs are indeed highly selective in their
admissions process, and some of their students
are indeed truly outstanding. But most are merely
good, and as far as the school itself is concerned,
the school is NOT world-class; the faculty do not
have the major publications and patents and so on to make
IIT even eligible for consideration as a first-rate
technical university.

Moreover, the vast majority of Sun Microsystems'
Indian H-1Bs are not IIT graduates anyway.

http://news.com.com/2100-1011-993123.html?tag=fd_top

Ex-Sun worker files discrimination suit
By Lisa M. Bowman
Staff Writer, CNET News.com
March 18, 2003, 1:36 PM PT
http://news.com.com/2100-1011-993123.html

A former Sun Microsystems employee is suing the company, claiming it
violated age and race discrimination laws by keeping younger East
Indian workers while firing him and other American workers.

Walter Kruz, 52, who worked for Sun starting in May 2000 as a software
engineering manager, claims Sun cut American workers and replaced them
with workers from India who were younger and lower-paid. The suit
alleges that Sun refused to rehire any of the laid off American
workers, and that it developed a performance evaluation program that
favored the retention of H-1B visa holders in order to save money.

"Ultimately, Sun's scheme was successful, allowing it to keep certain
positions filled while dramatically reducing its labor costs," the suit
said. "But Sun's preference for young East Indians and East Indian visa
holders in its RIF (reduction in force) selection process discriminated
against workers of other races and national origins as well as against
workers over the age of 40."

The case is likely to fuel the fire over H-1B visas, which allow
skilled workers into the United States for up to six years. Some tech
workers have long questioned the need for such visas, claiming skilled
Americans could fill the jobs and companies are just looking for
cheaper workers. Tech companies, which successfully lobbied Congress
for a higher H-1B cap during boom times, argue that they still need the
workers for certain tasks. Although it's not illegal to hire or retain
H-1B workers in lieu of American workers in most cases, employers must
pay the "prevailing" wages for specific jobs in a region and the
process cannot adversely impact a specific population of workers.

Kruz's suit, filed in Superior Court in Santa Clara County, Calif.,
seeks class action status on behalf of all "non-East Indian" employees
that were affected by Sun's work force reduction policies. James
Caputo, an attorney representing Kruz, estimates the class could
encompass as many as 2,400 former Sun workers. The suit seeks
unspecified damages and a jury trial.

The suit claims that Sun has a bias in favor of East Indian workers
that is "an extricable part of its corporate culture. The suit also
cites a 60 Minutes interview with sun co-founder Vinod Khosla, now a
partner at venture capital firm at Kleiner Perkins Caufield & Byers, in
which he said East Indians are "favored over almost anybody else."

Sun spokeswoman Diane Carlini said the company had not yet seen the
suit, but she said the quotes were taken out of context. She said that
Khosla, who is no longer an employee of the company, does not have sway
over the company's hiring and firing practices, as far as she knows.

Khosla did not immediately respond to requests for comment.

Carlini also said Sun has been cleared of similar charges that its H-1B
practices violated labor laws. "It seems similar to what we've seen in
the past where we have been cleared," she said.

It's hard to come up with an exact figure for the number of employment
discrimination claims based on H-1B issues because such complaints are
filed through a variety of disparate channels, including federal and
state courts and agencies such as the Equal Employment Opportunity
Commission. However, many laid off high-tech workers experiencing
prolonged layoffs in a down economy are becoming more vocal in blaming
H-1B workers and outsourced employment for their plight.

Caputo has filed a similar suit in federal court in Colorado on behalf
of ex-Sun workers who are not California residents. In another similar
case, former Sun worker Guy Santiglia charged the company broke laws
related to H-1B hiring practices. Last month, a Department of Labor
administrative law judge ruled that Santiglia, who decided midway
through proceedings to represent himself, had failed to prove the
company significantly violated employment law.

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