BILL ANALYSIS Ó
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Date of Hearing: June 24, 2015
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Roger Hernández, Chair
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(Eduardo Garcia) - As Amended May 26, 2015
SUBJECT: H-1B Visa program: investigation of misuse.
SUMMARY: Urges the United States Department of Labor and
Congress to investigate the alleged misuse of the H1-B Visa
program. Specifically, this resolution makes the following
legislative findings and declarations:
1)The H-1B Visa program allows businesses to temporarily hire
highly skilled foreign workers with specialized knowledge
where a qualified United States worker cannot be found.
2)The H-1B Visa program was never intended to be used as a
catalyst for laying off United States' workers and replacing
them with H-1B workers.
3)The granting of H-1B Visas should never result in the creation
of a virtual pipeline for outsourcing United States workforce
jobs.
4)California's average unemployment rate in January 2015 was 6.9
percent with Imperial County's unemployment rate being 20.6
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percent.
5)Some companies are misusing the federal H-1B Visa program,
including the documented misuse by one California public
utility to replace 400 California workers.
6)Senate Bill No. 477 (Chapter 711 of the Statutes of 2014)
seeks to end the exploitation of foreign, temporary,
nonimmigrant workers brought to California under various
federal work visa programs.
7)Displaced American workers are being exploited through the
misapplication of the H-1B Visa program.
In addition, this resolution makes the following resolutions:
1)That the Legislature respectfully urges the United States
Department of Labor and the Congress of the United States to
investigate this alleged misuse of the H1-B Visa program.
2)That any company that has engaged in this improper practice is
urged to immediately cease the practice of replacing
California employees with foreign workers under this, or any
other, program.
3)That the Chief Clerk of the Assembly transmit copies of this
resolution to the President and Vice President of the United
States, the Speaker of the House of Representatives, the
Minority Leader of the House of Representatives, the Majority
Leader of the Senate, the Minority Leader of the Senate, and
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each Senator and Representative from California in the
Congress of the United States.
FISCAL EFFECT: None. This bill is keyed non-fiscal by the
Legislative Counsel.
COMMENTS:
Overview of the H1-B Visa Program
The H-1B program applies to employers seeking to hire
nonimmigrant aliens as workers in specialty occupations or as
fashion models of distinguished merit and ability. A specialty
occupation is one that requires the application of a body of
highly specialized knowledge and the attainment of at least a
bachelor's degree or its equivalent. The intent of the H-1B
provisions is to help employers who cannot otherwise obtain
needed business skills and abilities from the U.S. workforce by
authorizing the temporary employment of qualified individuals
who are not otherwise authorized to work in the United States.
The law establishes certain standards in order to protect
similarly employed U.S. workers from being adversely affected by
the employment of the nonimmigrant workers, as well as to
protect the H-1B nonimmigrant workers. Employers must attest to
the Department of Labor that they will pay wages to the H-1B
nonimmigrant workers that are at least equal to the actual wage
paid by the employer to other workers with similar experience
and qualifications for the job in question, or the prevailing
wage for the occupation in the area of intended employment -
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whichever is greater.
Prospective employers must obtain a certification of a Labor
Condition Application (LCA) from the U.S. Department of Labor
(DOL). This application includes certain attestations, a
violation of which can result in fines, bars on sponsoring
nonimmigrant or immigrant petitions, and other sanctions to the
employer. The application requires the employer to attest that
it will comply with the following labor requirements:
The employer will pay the beneficiary a wage which is
no less than the wage paid to similarly qualified workers
or, if greater, the prevailing wage for your position in
the geographic area in which you will be working.
The employer will provide working conditions that will
not adversely affect other similarly employed workers. At
the time of the labor condition application there is no
strike or lockout at the employer place of business.
The duration of stay under an H1-B visa is three years,
extendable to six years. The current law limits to 65,000 the
number of foreign nationals who may be issued a visa or
otherwise provided H-1B status each fiscal year. Laws exempt up
to 20,000 foreign nationals holding a master's or higher degree
from U.S. universities from the cap on H-1B visas. In addition,
excluded from the ceiling are all H-1B non-immigrants who work
at (but not necessarily for) universities, non-profit research
facilities associated with universities, and government research
facilities.
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Recent Allegations of Abuse of the H1-B Visa Program and
Southern California Edison
Recently, Southern California Edison (SCE) announced plans to
lay off hundreds of employees and hire foreign workers. SCE
announced that it was laying off about 400 information
technology employees, with an additional 100 leaving
voluntarily. SCE said that it was outsourcing some tech-related
work to two Indian companies, Infosys in Bangalore and Tata
Consultancy Services in Mumbai, after looking at multiple firms.
According to SCE, about 70% of the work would be done by Tata
and Infosys will be completed offshore, but did not know whether
or not foreign workers would be brought to the US to complete
the remaining 30% of the work. SCE said the layoffs are
necessary to stay competitive.
In addition, some of the foreign workers hired by SCE are in the
US because of the H-1B visa. The H-1B visa allows United States
(US) companies to temporarily hire foreign workers in certain
occupations. The number of visas is capped at 65,000 (plus
20,000 for workers with master's degrees) annually. The visa is
a way to encourage foreign workers with specific expertise,
mostly in science, technology, engineering, and mathematics
related fields, to work in the US in areas where there is a
shortage of US workers. In March 2015, the US Senate Judiciary
Committee held a hearing on "Immigration Reforms Needed to
Protect Skilled American Workers." The hearing focused on
problems with the H-1B and other visa programs. The hearing
noted that the visas are used to bring high-skilled workers into
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the US so that companies can continue to attract world-class
talent and continue to lead on the global stage. However, the
hearing highlighted troubling stories of abuses that have caused
the displacement of American workers, and noted that these visa
programs are to be used to complement the US workforce, not
displace it.
The Los Angeles Times reported in April that the Department of
Labor was not planning to investigate alleged abuse of the H1-B
visa program by SCE. However, on May 29, 2015, an official from
U.S. Citizenship and Immigration Services wrote to a Member of
Congress that the agency strives "to do our work with the
greatest possible integrity and efficiency." The letter
continues, "This includes following up on concerns such as those
you raise regarding Southern California Edison to ensure that
petitions are entirely consistent with our legal framework.
USCIS will work with the Department of Labor to review visa
petitions and labor condition and certification applications, as
appropriate. If we receive information that alleges violations
have occurred, the Department will take appropriate action to
maintain the integrity of our programs."
Other Recent Criticisms of the H1-B Visa Program
A recent article<1> in the New York Times raised similar
concerns about allegations involving the use of H1-B visa in
technology jobs at Disney, Fossil, and Northeast Utilities,
among others. The article stated:
---------------------------
<1>
http://mobile.nytimes.com/2015/06/04/us/last-task-after-layoff-at
-disney-train-foreign-replacements.html?_r=1
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"But the layoffs at Disney and at other companies, including
the Southern California Edison power utility, are raising new
questions about how businesses and outsourcing companies are
using the temporary visas, known as H-1B, to place immigrants
in technology jobs in the United States. These visas are at
the center of a fierce debate in Congress over whether they
complement American workers or displace them.
According to federal guidelines, the visas are intended for
foreigners with advanced science or computer skills to fill
discrete positions when American workers with those skills
cannot be found. Their use, the guidelines say, should not
"adversely affect the wages and working conditions" of
Americans. Because of legal loopholes, however, in practice,
companies do not have to recruit American workers first or
guarantee that Americans will not be displaced.
Too often, critics say, the visas are being used to bring in
immigrants to do the work of Americans for less money, with
laid-off American workers having to train their
replacements.
'The program has created a highly lucrative business model
of bringing in cheaper H-1B workers to substitute for
Americans,' said Ronil Hira, a professor of public policy at
Howard University who studies visa programs and has
testified before Congress about H-1B visas?
?H-1B immigrants work for less than American tech workers,
Professor Hira said at a hearing in March of the Senate
Judiciary Committee, because of weaknesses in wage
regulations. The savings have been 25 percent to 49 percent in
recent cases, he told lawmakers."
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ARGUMENTS IN SUPPORT:
Supporters argue that the H1-B visa program was never intended
as a vehicle to replace skilled workers in the United States.
In some instances, the workers that were being laid off were
coerced into training their replacements. They argue that this
is a violation of the letter and spirit of the program and such
behavior cannot be tolerated.
RELATED LEGISLATION:
AB 853 (Roger Hernández) would require an electrical or gas
corporation to use direct employees for any work associated with
the design, engineering, and operation of its nuclear,
electrical, and gas infrastructure, including all computer and
information systems, to the extent feasible. Furthermore, AB
853 would prohibit an electrical or gas corporation from using a
non-direct employee, unless it files a Tier 3 advice letter with
the California Public Utilities Commission that demonstrates
that the work can be performed safely and securely, and without
jeopardizing the security of the utilities infrastructure. AB
853 is currently pending in the Senate.
REGISTERED SUPPORT / OPPOSITION:
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Support
California State Association of Electrical Workers
California State Pipe Trades Council
Coalition of California Utility Employees (sponsor)
International Union of Elevator Constructors
Western States Council of Sheet Metal Workers
Opposition
None on file.
Analysis Prepared by:Ben Ebbink / L. & E. / (916) 319-2091
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