A US tech company was found guilty of abusing the H-1B visa

Some H-1B employers are up to shady business.
Some H-1B employers are up to shady business.
Image: Reuters/Robert Galbraith
We may earn a commission from links on this page.

Yet again, an American employer is under the scanner for misusing the H-1B programme.

People Tech Group, a technology staffing company in Redmond, Washington, has been accused of paying employees unfair wages. This comes just days after an Indian-origin CEO of two technology firms in the same state was taken into custody for forging documents to illegally bring foreign workers into the US.

“People Tech Group paid entry-level wages to H-1B computer analysts and computer programmers who performed the work of much more experienced employees and should have received higher prevailing rates,” an investigation by the US department of labor’s wage and hour division (WHD) found, according to a press release from Sept. 13. “The company also failed to pay workers for time when the company failed to provide work, as the law requires.”

People Tech Group, which has offices in Bengaluru and Hyderabad, has been instructed to pay 12 employees $309,914 in back wages. It also owes $45,564 in civil penalties for the violations.

“The intent of the H-1B foreign labour certification programme is to help American companies find the highly skilled talent they need when they can prove that a shortage of US workers exists,” said WHD acting district director Carrie Aguilar in Seattle. “The resolution of this case demonstrates our commitment to safeguard American jobs, level the playing field for law-abiding employers, and ensure no one is being paid less than they are legally owed.”

This is just one more step in a series of crackdowns on the H-1B programme by the Donald Trump administration. From arming immigration officers with the right to outright deny an application without furnishing requests for evidence (RFEs) first to making targeted on-site visits to uncover fraud and abuse, the government is making it harder to secure the work visa.

In May, WHD found California-based Cloudwick Technologies, owned by Indian-American Mani Chhabra, guilty of paying temporary workers a mere $800 in monthly salary after promising them $8,000. A year ago, Indian IT behemoth Infosys paid $1 million to settle a probe into its visa violations. Outside the tech industry, a local public school district in Maryland was ordered by the Obama administration in 2011 to pay $5.9 million in back wages and fines and a New Jersey consulting firm had to give $300,000 to workers for similar offences the following year.

The H-1B visa programme allows US companies to employ foreign workers in specialty occupations for up to six years to plug the acute talent crunch (pdf) in the economy. While Indian IT services firms are the biggest beneficiaries of the H-1B visa programme, several Silicon Valley bigwigs like Amazon and Microsoft also extensively rely on it.

“The United States is experiencing a skills shortage on the whole, but the STEM industry, which is largely responsible for the development of new products and technologies, suffers the most,” said Richard Burke, CEO of global immigration platform Envoy. The bureau of labour statistics (pdf) predicts one million job openings in the computer field alone until 2024. “Cultivating homegrown talent is crucial in the long term, but foreign nationals fulfil important company needs and keep the ball rolling on innovation,” Burke added.