Date: Wed, 23 Nov 2005 16:41:43 -0800 From: Norm Matloff To: Norm Matloff Subject: DOL rules against Computech To: H-1B/L-1/offshoring e-newsletter The enclosed article reports that the Dept. of Labor has found that Computech has violated various aspects of H-1B law. The violations are of two main types: (a) Failure to pay prevailing wage, and (b) failure to pay H-1Bs while they are (in the job shop world lingo) "on the bench," i.e. in between assignments. Some critics of the H-1B program have been considering this to be a victory for their side. But it ISN'T. As I have pointed out many times, H-1B law is chock full of loopholes, so many loopholes that underpaying H-1Bs is extremely easy. Immigration attorney Joel Stewart once wrote, "Employers who favor aliens have an arsenal of legal means to reject all U.S. workers who apply." (Joel Stewart, "Legal Rejection of U.S. Workers," Immigration Daily, April 24, 2000.) Well, the same is true for H-1B. And again, remember that it's not just the job shops that abuse the program; it's basically ALL companies, including the big famous ones. Just as, say Intel, takes advantages of all loopholes in the tax code, it is also the case that Intel and the others take advantage of loopholes in H-1B law. See my e-newsletter posting at http://heather.cs.ucdavis.edu/Archive/IntelH1BWages.txt The point is, then, that the prevailing wage as determined by DOL is meaningless, and thus IN FACT DOL'S HANDS ARE TIED. All DOL can do is enforce the law, and the law is broken. THERE IS NOTHING TO ENFORCE. All this is illustrated by the fact that the average amount of the settlement is only $9700 per worker, over a two-year period. Let's try to estimate what this really means. Before we start, we must recognize that some of the workers may not have been there for the full two years, but H-1Bs don't (and in various senses can't) job-hop, so let's assume that most of them were there for the full time. That would mean an average settlement of, say, $4500 per worker PER YEAR. Now, the article here doesn't say how much of the settlement was due to underpayment and how much was due to nonpayment during bench time. Since I am interested mainly in the underpayment issue, let's give Computech the benefit of the doubt and assume that the vast majority of the settlement was for underpayment. My point, then, is that one must compare that $4500 figure above with the $18,000 that Mr. Patchava says he was underpaid in the article below. In other words, THE SIZE OF THE SETTLEMENT IS AN INDICTMENT NOT ONLY OF COMPUTECH BUT ALSO OF THE BASIC H-1B PREVAILING WAGE LAW ITSELF. A House/Senate conference committee will soon decide whether to approve a 30,000 visa/year expansion of the H-1B program. Those who question the expansion will undoubtedly be referred to this Computech case, with the statement, "See, abuse is rare, and in those rare cases in which abuse occurs, DOL cracks down on them. H-1B is a fundamental sound program, so we should go ahead with this expansion." They may even throw in a few more dollars for enforcement. But remember, folks, THERE IS NOTHING TO ENFORCE. If Congress really were concerned about H-1B abuse, they would adopt the provisions in the Pascrell bill, especially the one which defines a GENUINE prevailing wage definition, not the meaningless one that we have now. Norm http://www.freep.com/apps/pbcs.dll/article?AID=/20051123/NEWS09/511230319/1011 Computech must pay old wages Labor Dept.: Immigrants were underpaid November 23, 2005 BY JEWEL GOPWANI FREE PRESS BUSINESS WRITER A Bingham Farms-based computer staffing firm plans to pay $2.25 million in back wages after the U.S. Department of Labor said it didn't adequately pay 232 employees, according to a settlement between the government and the tech firm. In one of the nation's largest settlements involving wages paid to immigrants, Computech Corp. also must pay $400,000 in fines to the Department of Labor, which says the company paid its workers lower wages than immigration law requires and failed to pay the workers for time they were idle, also a requirement for immigrants working in the technology industry. Vasudeva Patchava, a former Computech employee, said the company agreed to pay him at least $53,000 a year. Instead he received $35,000 a year. With that salary, Patchava couldn't afford to buy a house and bring his family to Michigan, so they stayed with relatives for six months in Akron, Ohio, before they could reunite when the company moved him out of Michigan. Despite agreeing to pay the back wages, Computech, which has done work for the City of Detroit and George Washington University in Washington, D.C., said it did nothing wrong. "While we believe our workers were fully and fairly compensated, we have agreed to settle these allegations from 1999 and 2000 so that we can move on with our business," Computech President Ram Kancharla said in a statement. The settlement, approved by an administrative judge with the Labor Department last week, also bars Computech from bringing workers to the United States for 18 months. "The Department of Labor aggressively enforces the law to ensure that temporary foreign workers are compensated fully and fairly," said Secretary of Labor Elaine L. Chao. "Abuse of the temporary foreign worker program is not tolerated and violators, as this case shows, are vigorously pursued." Patchava stayed with Computech between 1999 and 2003. "I didn't want to go to a different employer and get into the same situation," said Patchava, 44, and now living in Cupertino, Calif. He also felt pressured to stick with Computech because the company sponsored his temporary visa. The unpaid wages for the Computech workers stem from August 1998 to May 2000 and average about $9,700 per worker, according to the settlement. The company owes wages ranging from $168.10 to $41,791.84. The Department of Labor wouldn't say when employees were to receive their back wages, but Computech is supposed to make the payments in $70,000 quarterly installments until August 2014. The employees who were allegedly underpaid were brought to the United States legally on temporary H-1B visas. Such visas give immigrants who hold bachelor's degrees permission to work in the United States in professional occupations, such as technology or health care. According to immigration law, those employees are entitled to a generally accepted wage for computer programmers for about 40 hours a week, even when they do not have assignments. The aim of the law, immigration law experts say, is so companies pay the prevailing wage and do not undercut wages paid to American workers. The $2.25-million settlement is about $2 million less than what the Department of Labor said the company owed in March. "We took a position that much of the charges the Department of Labor had made were based on out-of-date and faulty documentation," said William Stock, Computech's attorney. Contact JEWEL GOPWANI at 313-223-4550 or gopwani@freepress.com.