[Congressional Record Volume 141, Number 165 (Tuesday, October 24, 1995)]
[Senate]
[Pages S15570-S15572]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




      U.S. WORKERS NEED MORE PROTECTION UNDER OUR IMMIGRATION LAWS

  Mr. KENNEDY. Mr. President, legal immigration within the limits and 
rules of our immigration laws has served America well throughout our 
history, and is one of the most important elements of our national 
strength and character.
  Clearly, Congress and the American people today are rightly concerned 
about illegal immigration. There is broad bipartisan support for 
effective measures to crack down on this festering problem. But we must 
be careful to ensure that attitudes toward illegal immigrants do not 
create a backlash against legal immigrants.
  In general, the current laws and policies on legal immigration work 
well, and we must be hesitant to change them, especially those that 
give high priority to encouraging family reunification and enabling 
U.S. citizens to bring their spouses, children, parents and siblings to 
this country.
  But one area of legal immigration that needs reform is in the rules 
protecting American workers. It has become clear that protections for 
U.S. workers under current law have not kept pace with changes in the 
American labor market and the world labor market.
  This problem is particularly serious in our laws permitting the entry 
of temporary foreign workers--the so-called nonimmigrants. Hearings 
conducted earlier this month by the Senate Subcommittee on Immigration, 
under the able chairmanship of Senator Simpson, have revealed the depth 
of this problem.
  U.S. companies are increasingly out-sourcing activities previously 
performed by permanent employees. More firms are resorting more often 
to the use of temporary workers or independent contractors as a way of 
increasing profits and reducing wages and benefits, even though the 
result is less in-house expertise for the firms.
  Often, the workers brought in from outside are U.S. citizens. But 
increasingly, U.S. firms are also turning to temporary foreign workers. 
Yet, this little known aspect of our immigration laws includes few 
protections for U.S. workers.
  Current laws governing permanent immigrant workers require employers 
to try to recruit U.S. workers first. The Department of Labor must 
certify that efforts for such recruitment have been carried out before 
an employer can sponsor an immigrant worker. This process has some 
shortcomings, but it is intended to guarantee that immigrant workers do 
not displace American workers.
  A serious problem is that our laws governing temporary foreign 
workers contain no such requirement. They are based on the outdated 
view that because they enter only temporarily, few protections for U.S. 
workers are required. Current law does not require employers to try to 
recruit U.S. workers first, and the Department of Labor has little 
authority to investigate and remedy abuses that arise, such as the 
underpayment of wages or the use of inadequate working conditions.
  As a result, a U.S. firm can lay off permanent U.S. workers and fill 
their jobs with temporary foreign workers--either by hiring them 
directly or by using outside contractors.
  In one case, a major U.S. computer firm laid off many of its U.S. 
computer programmers, then entered into a joint venture with an Indian 
computer firm that supplied replacement programmers--most of whom were 
temporary workers from India.
  While reforms are needed in this area, we must be careful not to 
throw the baby out with the bath water. Many temporary workers who come 
here provide unique skills that help the United States to stay 
competitive in the global marketplace. For example, such workers can 
bring unique knowledge and expertise to university research programs 
developing new medical advances and new technologies.
  As Congress takes up far-reaching reforms in legal immigration, it is 
vitally important that we recognize these basic distinctions. Stronger 
protections for American workers are needed. But they are not 
inconsistent with preserving an appropriate role for foreign workers 
with unique skills.
  In our subcommittee hearings earlier this month, Secretary of Labor 
Robert Reich proposed three important changes to our immigration laws 
on temporary foreign workers. I believe these should receive serious 
consideration by Congress.
  Secretary Reich proposed, first, that these employers should be 
required to make good faith efforts to recruit U.S. workers first--
before seeking the entry of a foreign worker. Second, he proposed that 
employers who lay off U.S. workers should be precluded from seeking 
foreign workers in that field for at least 6 months. Third, he proposed 
that the length of time that temporary foreign workers may remain in 
the United States be reduced from 6 years under current law to no more 
than 3 years, in order to reduce the overall number of temporary 
foreign workers in the country at a given time.
  In addition to these three thoughtful proposals by Secretary Reich, 
the bipartisan Commission on Immigration Reform, chaired by former 
Congresswoman Barbara Jordan, has recommended that employers who 
request 

[[Page S 15571]]
immigrants also be required to contribute to the training of American 
workers. As the Commission stated in its report last June,

       To demonstrate the bona fide need for a foreign worker and 
     to increase the competitiveness of U.S. workers, an employer 
     should be required to pay a substantial fee, that is, make a 
     substantial financial investment into a certified private 
     sector initiative dedicated to increasing the competitiveness 
     of U.S. workers.

  Each of these proposals is worth serious consideration by Congress--
both for permanent immigrant workers and for temporary foreign workers. 
As Congress moves forward in the coming months on far-reaching 
immigration reform legislation, it is essential that we enact stronger 
safeguards against unscrupulous resorting to foreign workers at the 
expense of American workers, and I look forward to working closely with 
my colleagues in the Senate and the House to achieve this important 
goal.
  Mr. President, I ask unanimous consent that a recent article from the 
Washington Post--``White-Collar Visas: Importing Needed Skills or Cheap 
Labor?''--be printed in the Record.
  There being no objection, the article was ordered to be printed in 
the Record, as follows:

               [From the Washington Post, Oct. 21, 1995]

      White-Collar Visas: Importing Needed Skills or Cheap Labor?

                         (By William Branigin)

       A large New York insurance company lays off 250 computer 
     programmers in three states and replaces them with lower-wage 
     temporary workers from India. A Michigan firm sends underpaid 
     physical therapists from Poland to work at health care 
     facilities in Texas. A company in California advertises that 
     it can supply employers with ``technical workers'' from the 
     Philippines at low pay.
       Even the White House resorts to cheap technical help, using 
     a company that imports most of its workers from India to 
     upgrade the president's correspondence-tracking computer 
     system.
       As Congress considers major changes in immigration law, the 
     Department of Labor and a number of professional associations 
     and private citizens are citing cases such as these in urging 
     an overhaul of a little-known immigration program designed to 
     meet shortages of highly skilled workers in certain 
     ``specialty occupations.'' The debate highlights much broader 
     dilemmas that the nation faces as it tries to decide how many 
     foreigners to admit and what qualifications to demand of 
     them.
       Each year, tens of thousands of such workers from around 
     the world are brought into the United States under the H-1B 
     visa program, which admits computer programmers, engineers, 
     scientists, health care workers and fashion models under 
     ``nonimmigrant'' status.
       Businesses say they need the program to obtain quick, 
     temporary professional help that cannot be found in the U.S. 
     work force. They say the visa category enables them to 
     hire people with ``unique'' skills--the ``best and 
     brightest'' that the world has to offer--and to compete in 
     an increasingly tough global market.
       Advocates of this and other employment-based visa programs 
     cite numerous cases in which foreign professionals with 
     special expertise have made valuable contributions to 
     American science and technology and have helped create jobs 
     in the American economy. But the Labor Department says the H-
     1B program also has been widely exploited to bring in 
     thousands of foreign professionals and technicians whose 
     chief attraction is that they are willing to work for much 
     lower salaries than their U.S. counterparts. Many are 
     imported by job-contracting firms known as ``body shops,'' 
     which recruit the foreign professionals and hire them out to 
     major U.S. companies at a profit.
       In many cases, ``employment-based immigration is used not 
     to obtain unique skills, but cheap, compliant labor,'' said 
     Lawrence Richards, a former IBM computer programmer who 
     formed the Software Professionals' Political Action Committee 
     last year after colleagues were laid off and replaced by 
     lower-paid programmers from India.
       Richards and other critics of the H-1B visa program 
     described the imported professionals as ``techno-braceros,'' 
     the high-tech equivalent of migrant farm workers.
       They charged that the program is driving down wages in 
     certain sectors, displacing American workers and bringing in 
     foreigners who often are effectively ``indentured'' to their 
     employers. In the long run, they predicted, it will 
     accelerate the flight of high-tech jobs overseas, discourage 
     American students from studying for those occupations and 
     produce the very shortages it was designed to alleviate.
       In addition, some immigrants have used the program to set 
     up lucrative job-contracting concerns that discriminate 
     against Americans in hiring, sometimes even as they receive 
     federal assistance for minority-owned businesses.
       To remedy what he says is a situation ``fraught with 
     abuse,'' Labor Secretary Robert B. Reich is seeking major 
     reforms under immigration legislation now being debated in 
     both chambers of Congress.
       ``We have seen numerous instances in which American 
     businesses have brought in foreign skilled workers after 
     having laid off skilled American workers, simply because they 
     can get the foreign workers more cheaply,'' Reich said in an 
     interview. The program ``has become a major means of 
     circumventing the costs of paying skilled American workers or 
     the costs of training them,'' he added.
       ``There is abuse of the current nonimmigrant system, but it 
     is by no means overwhelming,'' argued Austin T. Fragomen, an 
     immigration lawyer who represents major U.S. corporations, 
     ``To the extent there is abuse, [it] occurs among small, 
     relatively unknown companies'' and should be ``controlled 
     through more effective enforcement,'' he said in written 
     Senate testimony last month.
       ``It is minimally widespread,'' said Charles A. 
     Billingsley, of the Information Technology Association of 
     America, a pro-immigration group. ``Are U.S. workers being 
     put out of work by foreign workers? Probably. But the 
     occurrence is minuscule.'' In any case, he said, H-1B visa 
     holders account for only `` a fraction of the U.S. work 
     force.''
       Such arguments are not much comfort to John Morris, who 
     owns a computer consulting firm in Houston. He said he lost 
     his largest customer, a major oil company, when he refused to 
     supply it with cheap foreign programmers.
       ``Greed is the reason they're doing this,'' Morris said. 
     ``Anybody who says it ain't greed is smoking rope.''
       He said he also has turned down a Chinese company's offer 
     to provide programmers for placement at $500 a month in jobs 
     that usually would pay $5,000 a month.
       ``The Chinese are desperate to get in here,'' Morris said. 
     ``This is economic warfare.''
       In 1990, Congress passed an immigration act that raised a 
     cap on permanent employment-based immigration from 54,000 to 
     140,000 a year in response to fears of an imminent shortage 
     of scientists, engineers and other highly skilled 
     professionals. A separate provision created the H--1B visa 
     category, which lets in as many as 65,000 professionals a 
     year for stays of up to six years. These workers are supposed 
     to be paid ``prevailing wages'' and not used to break 
     strikes.
       The H-1B provision requires no test of the U.S. labor 
     market for the availability of qualified American workers, 
     and it does not bar businesses from replacing U.S. workers 
     with ``temporary'' nonimmigrants.
       In practice, critics say, ``prevailing wages'' have been 
     defined too broadly to prevent many job contractors from 
     significantly undercutting the salaries usually paid to 
     Americans. Moreover, the anticipated shortages did not 
     materialize, in part because defense industry cuts after the 
     end of the Cold War added to the ranks of an estimated 2.3 
     million Americans who have been laid off so far this decade.
       In Senate testimony last month, Reich called on Congress to 
     prohibit employers from hiring nonimmigrant workers in place 
     of Americans who were laid off. He said companies should be 
     required to show they had tried to ``recruit and retain U.S. 
     workers' in the occupations for which nonimmigrants were 
     sought. He also recommended that the permitted stay of these 
     workers be reduced to three years.
       ``Hiring foreign over domestic workers should be the rare 
     exception, not the rule,'' Reich said.
       The labor secretary noted that although nonimmigrant 
     workers are admitted on a ``temporary'' basis, many stay for 
     years, sometimes illegally. More than half of foreigners 
     granted permanent resident status in fiscal 1994 originally 
     came in as nonimmigrant students or ``temporary'' workers, 
     Reich said.
       In response to ``abuse'' of the nonimmigrant programs, over 
     the past three years the Labor Department has charged 33 
     employers with wage violations involving more than 400 
     workers in physical therapy and computer-related occupations.
       In one case, the department found that an Indian-owned firm 
     in Michigan called Syntel Inc. had ``willfully underpaid'' 
     its Indian computer programmers, who came to the United 
     States under H-1B visas and made up more than 80 percent of 
     the company's work force.
       In November last year, American International Group, a 
     large Manhattan-based insurer, paid off 250 American 
     programmers in New York, New Jersey and New Hampshire and 
     transferred the work to Syntel. Syntel assigned some of the 
     work to about 200 Indians it had brought in, reportedly at 
     about half the American's salaries, and gave the rest to much 
     to much lower-paid employees at its home office in Bombay. 
     During their last weeks of employment, the laid-off U.S. 
     workers were even required to train their replacements, Reich 
     said.
       ``It was clear that Syntel did not bring in any special 
     skills that we did not have,'' said Linda Kilcrease, one of 
     the full-time programmers who lost their jobs.
       Another Michigan company, Rehab One, was found by the Labor 
     Department to have underpaid physical therapists it brought 
     in from Poland. The workers, who came in with H-1B visas, 
     were assigned to U.S. health care facilities, primarily in 
     Texas, and were paid as little as $500 a month, the 
     department found.

[[Page S 15572]]

       In New Jersey, a major shipping company, Sea-Land Services, 
     laid off 325 computer programmers this year and replaced them 
     with Filipinos supplied by Manila-based Software Ventures 
     International. The Americans. who were paid about $50,000 a 
     year on average, also had to train the lower-paid Filipinos, 
     most of whom eventually returned to Manila to carry out the 
     work even more cheaply there.
       ``I was outraged,'' said Jessie Lindsay, one of the former 
     Sea-Land programmers. ``There were highly paid technical jobs 
     leaving the country. . . . What's the point of getting an 
     education and technical training if companies can get away 
     with hiring at slave wages?''
       Mastech Corp., of Oakdale, Pa., a company owned by two 
     Indian immigrants that has won millions of dollars in 
     consulting contracts with the federal government, has brought 
     in about 900 of its 1,300 workers from India under the H-1B 
     program. From 1991 until Sept. 30, one of its contracts, 
     obtained under a set-aside program for minority-owned 
     businesses, involved ``computer system integration, 
     installation, maintenance and operational support for the 
     White House correspondence system,'' the presidential press 
     office said.
       ``We have been lumped in with some other companies that 
     allegedly underpay their foreign workers,'' a Mastech 
     executive said. ``We are not a low-paying company.''
       One of the latest controversies over the H-1B program 
     erupted last month after it was reported that the National 
     Association of Securities Dealers had laid off 30 contract 
     computer programmers and hired an Indian firm, Tata 
     Consultancy Services, to do the work. The government-
     chartered association, based in Rockville, Md., owns, 
     operates and regulates the Nasdaq Stock Market. Tata, which 
     has a regional office in Silver Spring, is part of a huge 
     Indian conglomerate that company officials say produces 
     everything from tea to computer software.
       An NASD spokesman, Marc Beauchamp, said Tata would employ 
     about 40 people on the project, half of them working here on 
     H-1B visas and half at Tata's home office in Bombay. He 
     denied that any full-time NASD employees were fired and said 
     that ``fewer than 20 outside contractors could possibly be 
     affected'' by the move.
       The Indians essentially would be maintaining ``outmoded 
     technology'' so that regular NASD programmers could ``focus 
     on new technologies'' and perform ``more challenging work,'' 
     Beauchamp said. ``We found it made no business sense to hire 
     programmers that we would have to pay more than, or as much 
     as, the people we have on staff,'' he said.
       Neither NASD nor Tata would disclose details of the 
     contract. However, Tata insisted that it follows all U.S. 
     regulations and wage requirements.
       ``We are not a body shop,'' said A. Sruthi Sagar, the 
     firm's personnel manager. ``We are not in the business of 
     providing cheap labor to the United States.''

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