IT stocks fell as much as 4 percent on Friday amid concerns that a bill backing key changes in the H1-B Visa programme, that allows skilled workers from countries like India to fill high-tech jobs in the United States, has been re-introduced in the US Congress.
Key changes in the visa programme have been proposed in the bill after many companies have been criticised for misuse of the same. Two lawmakers in the US have backed it saying that it will help crackdown on the work visa abuse.
Here’s a look at what the H1-B Visa programme actually entails and what President-elect Donald Trump thinks about it.
What Is H1-B Visa Programme
The H1-B visa is a non-immigrant visa given by the United States government to employ skilled workers in specialised fields, belonging to other countries, for a certain time period.
What Does the Bill Say?
- It prohibits companies from hiring H1-B employees if they have a staff strength of over 50 and over 50 percent of those staffers are H1-B and L-1 visa holders.
- Companies are being encouraged to hire an American workforce. This provision targets outsourcing companies who fly in staffers for short periods of time to train them and then send them to their home countries to do the work which an American would have done otherwise.
- Prohibition of replacement of American workers by H1-B or L-1 visa holders.
- The Bill aims to increase the minimum salary of H1-B visa holders to $100,000 per annum.
- Currently, firms are not required to go through extensive paperwork if the prospective H1-B visa holder has a Master’s or a higher degree and is paid at least $60,000 annually. The Master’s degree provision is aiming to be done away with, as “they are easily obtained by foreign workers.”
What Is Trump’s Stance?
Donald Trump has said he will end the visa programme misuse by companies, which disadvantages American workers, hinting at an incident involving Indian companies and workers with H1-B visas.
Without naming them, Trump alluded to HCL Inc and Cognizant Technology Solutions who hired IT professionals on H1-B visas for contracts obtained from Disney World in Florida.
My administration will follow a simple rule – buy American, hire American. Years earlier we used to take pride in buying things ‘Made in America’. We love our companies, but we don’t love them when they go out of our country. There will be consequences.Donald Trump
How Will Indian Comapnies Get Affected
India’s IT industry believes that the Bill doesn’t address the problem’s root cause which is the shortage of skills in Science, Technology, Engineering and Maths in the US.
There is a perception that companies pay low salaries to people who are sent to work on these visas…High-skilled IT workers on temporary visas earn competitive salaries and cost their employers as much or more than their American counterparts. There are various studies which point this out.Shivendra Singh, VP Global Trade Development, Nasscom
The US also hiked the visa fee recently for certain categories of the H1-B and L-1 visas which had an impact on Indian companies.
Source: The Hindu, PTI
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