Cap on the Number of L-1 Visas?

Date: Sunday, June 08, 2003 1:02 PM

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This aritcle contains some erroneous facts. Fortunately it's easy to
add comments so we can correct the author.

It does raise a very important issue. The L-1 visa should be abolished,
but since that's unlikely it should have a yearly cap on the number of
visas issued, and labor certification should be required just as for
H-1Bs. Mica's so-called reform doesn't address these issue and that's
just more reason not to support it.

http://comment.cio.com/soundoff/060503.html

Jun 05, 2003 Column

Should We Put a Cap on the Number of L-1 Visas?

by Art Jahnke

After years of high-volume complaints, critics of H-1B visas are
quieter now. Thats largely because the annual cap on H-1Bs, which
allow highly-skilled foreign workers to work for U.S. firms, will
automatically drop from 195,000 to 115,000 in October.
But its a safe bet that those critics, many of them unemployed
American technology workers, will not be quiet for long. Another battle
is brewing over another type of visa: the L-1, which allows companies
to transfer workers based in other countries to facilities based in the
United States.

In some ways, the L-1 visas are more threatening to U.S. workers than
the H-1Bs are. Unlike H-1Bs, L-1s do not require that workers be paid
in accordance with the prevailing wage, which means that foreign
workers coming here under the protection of L-1s offer greater savings
to employers. And unlike workers with H-1Bs, workers with L-1s dont
have to pay a $1,000 fee that goes toward the training of American
workers. Perhaps most troubling, the government has not capped the
number of L-1 visas issued. And that number is growing. In 1999, the
government issued 41,739 L-1s. Last year, it issued 57,700.

That increase (40 percent) is substantial, but it pales in comparison
to the growth in L-1s used by Indian companies to whom U.S. enterprises
outsource labor. In the last two years, for example, the number of L-1
visas used by Wipro workers climbed from 510 to 1,157, and the number
issued to Infosys workers jumped from 292 to 1,760. (To read more about
outsourcing and the use of offshore workers at home, read "Inside
Outsourcing in India" in the June 1 issue of CIO.)

According to a recent story in The San Francisco Chronicle, it is
becoming standard operating procedure for an Indian outsourcing firm to
take over a project for an American client, send in a team of visa
holders to learn the companys procedures, and transfer much of the
work back to India. But even if the work remains in this country,
observers point out, it is assigned to L-1 workers, who often replace
higher-paid American workers.

John Mica, a U.S. Representative from Florida, where a group of Siemens
workers were let go after a project was outsourced to India-based Tata
Consultancy Services, has filed legislation that would put some
restrictions on L-1 visa use. Micas bill would require that
companies hiring L-1 workers employ only those workers who had worked
directly for their subsidiaries, not for third party outsourcers like
Wipro, Infosys and Tata. Many U.S. workers regard Micas effort as a
good start, but some say it doesnt go far enough: They would like
see the L-1 visa eliminated, or at least capped, like its cousin, the
H-1B. What do you think? What should be done with the L-1?

Sound Off is a weekly column about current IT-related issues. Web
Editorial Director Art Jahnke (ajahnke@cio.com) always welcomes
feedback.

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