From matloff@laura.cs.ucdavis.edu Thu Jun 12 23:00:33 2003 Date: Thu, 12 Jun 2003 22:56:08 -0700 From: Norm Matloff To: Norm Matloff Subject: details on gaping loophole in the Mica bill To: age discrimination/H-1B/L-1 e-newsletter There will be two points of interest in this posting regarding the Mica bill: (a) a relevant DOL document and (b) an interesting letter to Mica from a major pro-H-1B/L-1 lobbying group. Recall that when the Mica L-1 "reform" bill came out, I pointed to a huge loophole in the clause, "indicia of a employment relationship." Let's explain this in the Tata/Siemens context which led to Mica's bill. The loophole would allow Tata to continue business with Siemens as long as it avoided the appearance of "indicia of a employment relationship" between the Tata workers and Siemens. Thus Tata need only make some cosmetic changes which bolstered Tata's image of the L-1 workers' "true" employer, and then continue business as usual with Siemens. I was thinking about this yesterday, and suddenly realized that this phrase, "indicia of a employment relationship," probably did not arise from Mica or his staff. Often "new" immigration legislation will borrow language from earlier statutes. So I searched on the Web, and found that sure enough, the phrase was borrowed from earlier legislation. In fact, it is from the 1998 legislation which created the concept of "H-1B-dependent employer." (When that legislation was enacted, I never paid much attention to that section, as I didn't think it would have much impact. As you know, that turned out to be the case; only 50 out of 50,000 H-1B employers were declared H-1B-dependent, and even of those that were, they seem to have escaped by turning to L-1s.) I then realized that the Dept. of Labor had probably set up guidelines as to what constitutes "indicia of an employment relationship," and sure enough, they have. I'm enclosing the list at the end of this message. As you will see, Tata should have no trouble using this list to demonstrate to DOL that Tata, not Siemens, is the real employer of these L-1s. For example, Tata would assure DOL (probably correctly), that Siemens has no right to fire the workers, to set their hours, etc. Note by the way that the DOL says explicitly that the mere fact that a Tata worker might work on the Siemens premises is NOT by itself an "index of an employment relationship." Now, what about the lobbying group? It's the American Council on International Personnel. Their stance on Mica's bill is at http://www.acip.com/acipweb.nsf/NewHome/29E239D23AAA9A4585256D330046338A? OpenDocument On that page is a letter that ACIP urges its members to send to Mica. The interesting part is that the organization THANKS Mica for including the "indicia of an employment relationship" provision. Though they are not referring to outsourcing, the point is that you can already see that the industry is planning to use this clause as their "way out," i.e. their loophole. Note that ACIP actually *opposes* the bill, though. They object to the requirement that the L-1 employer, say Tata, file an attestation with the DOL that their L-1s do not qualify as Siemens employees. ACIP says it does not want to go through DOL's bureaucracy, which is "burdensome" and may result in the DOL's asking them to make certain information public. The bill does NOT have such a requirement, but they are afraid that an "activist" DOL might take the law into its own hands. And basically ACIP is worried about the "slippery slope" phenomenon: If Congress gets DOL involved even a little in this bill, the next bill might expand DOL's powers more, etc. The same is true for the Indian companies like Tata. A number of people have asked me why those firms also oppose the bill, if it really doesn't do anything. The answer is that even though they would not be hurt by this bill, they are worried about the slippery slope too. The DOL list follows below. Norm Excerpted from http://www.dol.gov/dol/allcfr/Title_20/Part_655/20CFR655.738.htm: ...Relevant indicia of an employment relationship include: (A) The other/secondary employer has the right to control when, where, and how the nonimmigrant performs the job (the presence of this indicia would suggest that the relationship between the nonimmigrant and the other/secondary employer approaches the relationship which triggers the secondary displacement provision); (B) The other/secondary employer furnishes the tools, materials, and equipment; (C) The work is performed on the premises of the other/secondary employer (this indicia alone would not trigger the secondary displacement provision); (D) There is a continuing relationship between the nonimmigrant and the other/secondary employer; (E) The other/secondary employer has the right to assign additional projects to the nonimmigrant; (F) The other/secondary employer sets the hours of work and the duration of the job; (G) The work performed by the nonimmigrant is part of the regular business (including governmental, educational, and non-profit operations) of the other/secondary employer; (H) The other/secondary employer is itself in business; and (I) The other/secondary employer can discharge the nonimmigrant from providing services.