The Broad Scale Wage Theft by Tata Consulting and Infosys

Last Updated on May 10, 2021 by Shaun Snapp

Executive Summary

  • Tata Consulting and Infosys have been caught stealing wages from their H1-B workers.
  • This is the “new normal” in the US with companies that are large scale users of the H1-B program.

Introduction

Many Indian firms or firms that are significant users of H1-B labor repeatedly either do not pay their workers what it is stated in the LCA filings say that they do, or even steal wages from the H1-B employees.

Adding insult to injury, Infosys and Tata have a history of getting in trouble for paying even lower wages than they are already legally allowed to pay. In 2013 Tata paid $30 million to settle a wage theft dispute involving 13,000 foreign workers, and Infosys paid a record $34 million to settle a visa fraud case after it committed “systemic visa fraud and abuse of immigration processes.”

As a general principle, companies that behave like this should not be allowed to benefit from the U.S. temporary foreign worker programs, much less be the top two beneficiaries of them.

Despite what looked to observers like an insurmountable mountain of evidence against their client TATA, defense lawyers from the powerful, deep-pocked Loeb & Loeb with its 400 lawyers in eight offices in the U.S. and Asia prevailed over its less well-manned opposing counsel Kotchen and Low. – Economic Policy Institute

In the Tata case, employees were required to hand over their refund checks as is explained in the following quotation.

Tata also required its H1-B workers to sign a power of attorney allowing a company designated tax preparer to do their income taxes. The employer then required H1-Bs to endorse and sign over their tax refunds back to the company. Noting that Labor Department documents showed “from 2000 through 2013, at least $29.7 million was illegally withheld from about 4,400 tech workers here on H1-B visas.” – Sold Out

This is consistent with our other research that not only Tata and Infosys but Indian companies do not behave at all like countries that are based in the US.

Overstatement of the Amount Paid to H1-B Visa Holders

We may have a broadscale overestimation of the actual compensation paid to H1-B visa holders, as explained in the following quotation.

An audit performed by the DOL Inspector General in 1996 again reported that abuse was commonplace.

For example, it found that 19 percent of the H-1Bs were not being paid even the wage their employers had promised on the LCAs, a remarkable figure in view of the fact that the LCA wages tended to be low anyway. – University of Michigan Journal of Law Reform

This brings up the topic of how accurate the reported salaries are for H1-B workers as the Department of Labor does an abysmal job of actually tracking the H1-B workers.

Conclusion

Companies that are large scale users of the H1-B program are disreputable, and they have shown this through their behavior since the H1-B program started being used. Companies that are large scale users of the H1-B program, far from being innovative, and widely considered the worst employers in IT. India has the 10th highest income inequality in the world. It is considered entirely normal in India for workers to treated terribly, and many Indians in the US and Indian companies don’t understand why they can’t steal their employees’ wages. Or place them into contracts that are in contradiction with US employment standards, as we cover in the article Contract Clauses to Watch Out for In Indian Professional Service Agreements.

The H1-B program has allowed the horrible treatment of labor in India to come to the US. The H1-B program has even brought back bonded labor to the US, which we cover in the article How Indian IT is Bringing Bonded Labor to the US.

References

*https://www.epi.org/blog/new-data-infosys-tata-abuse-h-1b-program/

http://heather.cs.ucdavis.edu/Mich.pdf

*https://www.amazon.com/Sold-Out-Billionaires-Bipartisan-Crapweasels/dp/1501115944/

https://en.wikipedia.org/wiki/H-1B_visa

https://www.nohr1044.com/