June 4, 2009
You've heard of "Out Sourcing" so, what is "In Sourcing"?
- Unfortunately No Enforcement Yet
- So, you may ask yourself, what is the Dept. of Homeland Security/Immigration doing about this type of fraud? A kind of non-H1-B fraud, that nevertheless takes away American IT jobs 3 to 6 months at a time...drip, drip, drip...
The answer to that question also answers the following question:
So how do you beat the H1B system to come to America to make big bucks in the Information Technology field while taking jobs away from American workers?
Easy. Indian Consulting companies routinely pay for Indian citizens to come from India to the United States for the stated purpose of "taking a vacation". The length of stay can be up to six months in length. This is a perfect length of stay to be able to take on the typical short term project contract entailing programming or some other type of support or development effort.
Upon arrival the illegal worker stays in a hotel and the consulting company sets them up with laptop, cell phone and whatever else they need to get started. They work under a local project manager or in a project team wherein the labor is distributed among the team members. The Indian Consulting company can pay the illegal worker out of an India based subsidiary or with some other off shore method that hides the payment from US authorities. The Indian Consulting company can pay extremely low wages to the illegal workers while billing the US Client prevailing market rates. As long as the billing rates and consulting fees are more attractive to the US company than the cost of carrying US employees on their payroll, the Indian Consulting company can make a handsome profit. We figure that the profit potential is and has been enormous. The profit potential is so enormous, that if done on a massive scale, nationally across the whole US IT corporate spectrum, it might make sense to buy the hotels that the illegal workers are staying in. This would be a significant investment in the illicit infrastructure. It would tamp down any suspicions that might come from non-Indian hotel ownership or their personnel, who might "blow the whistle". There's probably some profit motive too, which keeps the money in the "family" so to speak.
Well, you've guessed it. Indians are buying hotels near big corporate clients, near their corporate operations or activities, or near clustered office parks that have big budgets for what used to be "Out Sourcing" or "Off Shoring". This can only mean that this has been going on for so long and is so widespread that the profits have amassed to afford investment in the hotels as entrenched infrastructure to continue the practice ( and our enforcement is asleep at the switch ). It's a little like the pre-911 anomalies being ignored to the detriment of lives and property that were lost in the attack. Are we ignoring all the little signs once again, clearly this is not likely to present a clear and present danger to lives and property, but it does create a clear and present danger to American IT jobs. These hotels are the updated version of the "Sweat Shops" of yesteryear, albeit now for Knowledge Workers. The illegal workers are able to access their wages here in the USA for living expenses, etc. by simply using an ATM card that can draw money from their overseas account. How much more confidence can Americans lose in institutions like Immigration who are charged with safeguarding our way of life?
What seems to be a glaring marker for this type of activity is the fact that large numbers of "hotel" guests, the illegal indian workers, are working from their hotel rooms, since neither the consulting company nor the US based corporate client want to put an illegal worker at their business sites. They have to maintain some "arms length" distance to facilitate the subterfuge and keep plausible denial on the table.
The real losers are American Workers and of course we're losing payroll taxes, since the labor is paid for off shore. The system is so pernicious that once enough of this illicit activity permeates a corporation, it doesn't take long for the workforce to turn more Indian and less non-Indian, so that you end up with a workforce containing legal Indian workers in management, supervisory roles and non-management, mixed with illegal Indian workers (the off site hotel workers). The next phase of misfortune for non-Indian US workers is an inherent mistrust of "outsiders" i.e. Americans, who might interfere, suspect or detect the low-cost labor tactics, resulting in fewer and fewer non-Indian workers gaining or retaining employment. And as you know the Indian population of tech ready Indian workers is large enough to probably displace the US population of technology workers many times over. As this continues, US non-Indian technology workers will continue to be blindsided and succumb inexplicably to this "loophole displacement" in the workforce.
Lack of Enforcement
Tell Us Your Story
We welcome anyone else who has seen suspicious activity that relates to this topic or this type of fraud in your own experience to leave your anonymous information for the Dept. of Homeland Security/Immigration Enforcement to peruse. Share your story with the other concerned citizens.