With H-1B visa, diversity doesn't apply

With H-1B visa, diversity doesn't apply

There's a dramatic difference where tech H-1B workers come from, depending on whether India-based outsourcers are involved.

Apple says workforce diversity "inspires creativity and innovation," but one of Apple's major contractors, Infosys, is far from diverse.

In 2013, Infosys, an India-based IT services firm, had 509 workers assigned to Apple sites in Cupertino, Calif. Of that number, 499 are listed as Asian, or 98%, with the remaining 10 identified as either white or black, according to government records.

Apple isn't the only firm with a disproportionate Infosys workforce. Of the 427 Infosys workers at insurance giant Aetna's Hartford, Conn., offices, 418 were identified in a court filing as Asian.

In the District of Columbia, where Infosys has developed a government-funded healthcare platform, 63 out of 71 workers are Asian. There are many other major employers that use Infosys with similarly large percentages of Asian workers, according to recently filed court documents in a Wisconsin federal lawsuit by four IT worker alleging discrimination.

This lopsided representation of Asian workers by IT services firms is not limited to Infosys. It is also a consequence of the H-1B visa program, which supplies most of the labor for the offshore IT services industry.

Nearly 86% of the H-1B visas issued by the U.S. for workers in computer occupations are for people from India, according to a Computerworld analysis of government data from a Freedom of Information Act request.

IT services firms "apparently cannot get enough Indian programmers, which has little to do with a shortage of competent natives for these types of jobs, but a lot to do with the industry's business model," said Lindsay Lowell, director of policy studies at Georgetown University's Institute for the Study of International Migration.

The offshore outsourcing firms "prefer young H-1B programmers because the visa offers control over this contracted short-term workforce, it permits them to pay less than they would for experienced natives and they cultivate programmers who can better serve their clients after returning home to India," said Lowell.

Many of these H-1B visa holders will work for an alternate universe of firms that primarily hire IT workers from India. In many instances these workers may be used to replace people such as Brian Buchanan, a former senior IT worker at Southern California Edison (SCE).

Buchanan last month joined a lawsuit filed earlier against Tata Consultancy Services in federal court, accusing the company of discrimination. The claims in this lawsuit, which were filed by the same legal team in the Infosys case in Wisconsin, are similar to what Infosys is now fighting.

Buchanan was laid off earlier this year from SCE and had to train his replacements from Tata, who were from India on a visa, according to the lawsuit. Tata has called the lawsuit "baseless," and reiterated that following the filing of last month's amended complaint. Infosys has previously denied the allegations as well.

Prior to his layoff, Buchanan attended a job fair, organized by SCE for its soon-to-be terminated employees.

At the Tata booth, which was staffed with "South Asians," Buchanan spoke with a Tata regional manager, who told him that the firm was hiring for jobs at SCE and elsewhere. But the Tata manager "was dismissive," the lawsuit alleges. In comparison, Buchanan "observed that the Tata employees spent considerably more time speaking with South Asian applicants and spoke to them in Hindi about available positions."

The lawsuit against Tata alleges that the firm staffed SCE "with an almost 100% South Asian workforce." It claims that about 95% of Tata's overall U.S. workforce is made up of South Asians.

A number of technology companies, including Apple, have begun disclosing the workforce diversity data they file with the U.S. Equal Employment Opportunity Commission (EEOC). This information stays confidential, unless the firm voluntarily discloses it or is released as part of a court case, which is what happened in the Infosys case.

Theses court cases have potential of shedding more light on the offshore outsourcing industry as well as putting Infosys and Tata, two of the top H-1B visa users, in the position of having to defend their business models. This defense has begun.

George Stohner, an attorney representing Infosys in the Wisconsin case, told the judge that "there's nothing that requires a U.S. employer doing business in the United States to manufacture in the United States. You can employ elsewhere."

"Nor is there ... any requirement," said Stohner, "for a foreign company doing business in the United States to employ workers in the United States." Infosys is required only to follow immigration laws, he said, according to a transcript of the proceeding.

(Story continues below charts.)

There were around 76,000 H-1B visas issued to people in computer occupations in 2014, which includes those applying for new employment whether or not they fall under the overall H-1B cap (some areas, such as research, are exempt).

After India's top share of visas for computer jobs, China was far behind in second place at just over 5%. No other nation rises above 1%, according to U.S. Citizenship and Immigration Services H-1B data for the 2014 federal fiscal year.

That's considerably different than in other fields, such as engineering, where workers from India had fewer than half the H-1B visas for new employment and China's share was almost quadruple its portion of computer jobs.

India has some advantages that has allowed its IT services to flourish, unlike China's, which was at one time seen as a potential IT services rival to the U.S.

The Indian IT services providers "have proven skillsets in IT services, and English proficiency plays a major role as well," explained David Rutchik, a managing director at Pace Harmon, an outsourcing consulting and advisory firm. "Security concerns are certainly an issue, but China doesn't have mature IT services for export capability either," he said.

But China may have a more developed internal IT market, said Eric Simonson, managing partner for research at the Everest Group, an IT services research and consulting firm. "The domestic IT business in China is stronger than in India, and the Chinese economy is larger and broader than India's economy; together these provide more career opportunities and increase labor rates for technical talent."

Chinese IT workers can work for companies such as Alibaba, an ecommerce site. "In India, these opportunities did not exist until fairly recently -- Flipkart being a hot recent example," he said. Flipkart is also an ecommerce site.

One indicator of imbalance in global visa distribution is to look at how many H-1Bs are going to engineers.

The U.S. issued H-1B visas last year to 8,103 engineers, which includes electrical, mechanical, civil, chemical, aeronautical and other engineering specialties. Workers from India still ranked number one but at 47%, a percentage that's well below the nearly 86% of H-1B visas going to people from India in the computer occupations. China had 19.5% of the engineering visas; Canada held 3.4%, Korea had 2.4%, Mexico held 2.2%, and Taiwan and Iran were tied at 2.2% each, according to government data obtained by Computerworld.

"This demonstrates just how dominant the outsourcing companies have become," said Russell Harrison, director of government relations at the IEEE-USA, of the number of H-1B visas that go to workers in computer occupations. The IEEE has 60,000 members in India and 40,000 in China.

"If companies were looking around the world to find the best possible candidates for their jobs, you would expect a distribution that was similar to the distribution of engineers on the planet and that's not what you have," said Harrison.

Apple and Aetna were both contacted but didn't have comment by deadline.

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Tags outsourcingAppleservicesinfosysIT outsourcingH-1B

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