President Barack Obama implemented his announced plan to help more foreign workers get temporary jobs in the U.S. Tuesday, issuing new guidance that will expand the L-1B visa program.
The memo, combined with Obama’s announcement Monday that “hundreds of thousands” of guest workers and their employers could benefit, will put pressure on immigration officials to accept more L-1B visa petitions.
These visas allow foreign companies to send employees with “specialized knowledge” to the states for up to seven years, which is supposed to incentivize them to make broader investments in the U.S. economy. But businesses have figured out how to abuse the program, and are using it to replace American workers with dramatically cheaper foreign labor.
The new guidelines, issued by the Department of Homeland Security, further loosen already broad requirements foreign workers and their employers must meet to qualify for the visa. And immigration officials can dole out as many visas as they deem appropriate, because no official cap is in place.
“This will lead to more offshoring of American jobs,” Ron Hira, a professor at Rochester Institute of Technology who is an expert in offshore outsourcing and industrial policy, told The Daily Caller News Foundation.
If they want to import cheap labor, businesses only have to show a given worker has “specialized knowledge.” They don’t have to prove there aren’t American workers who could take the job, so they can literally replace American workers with foreign workers.
Businesses can then legally pay that worker any wage they want, so long as it meets the minimum wage requirement in that state, and do not pay any kind of payroll taxes.
A typical IT worker in India, for example, makes around $5,000 a year, so businesses can pay them much smaller salaries than a comparable American workers.
Electronics for Imaging was paying imported employees $1.21 an hour, reported the San Jose Mercury News. A federal investigation in October resulted in just $40,000 of backpay to those employees, and a $3,500 fine.
In many cases American workers are forced to train their replacements. Michael Emmons was one of those workers in 2003. He and 19 of his fellow employees were laid off from a job with Siemens, but were asked to stick around and train their replacements. He eventually quit his job in protest, and took his story to the press.
Emmons was able to find another job, but his salary at the time went from $150,000 a year to about $54,000.
“Well-educated Americans should not have to train foreigners on visas so that they can be let go,” he told TheDCNF. “It’s just sick that our government lets this go on.”
The Senate Judiciary Committee held a hearing last week on this kind of abuse of guest worker programs. “Today’s hearing … leaves no doubt as to what is happening,” Republican Sen. Jeff Sessions said in the hearing. “Large corporations are using foreign worker programs explicitly for the purpose of replacing American workers at lower wages.”
Obama said Monday the move will benefit the U.S. economy. “America is proudly open for business, and we want to make it as simple and as attractive for you to set up shop here as is possible,” he said at a global investors summit.
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