Use H-1B or L-1 workers? Prepare for a Federal audit!

Summary: Audits for firms sponsoring L-1 and H-1B Visa Well, looks like the Feds are going to get around to auditing the firms that use L-1 and H-1B visas. Specifically, they’ll be verifying that the people who applied for these permits are who they purport themselves to be, that they are working where they said they would be and that their employers are paying them correctly (i.

Audits for firms sponsoring L-1 and H-1B Visa

Well, looks like the Feds are going to get around to auditing the firms that use L-1 and H-1B visas. Specifically, they’ll be verifying that the people who applied for these permits are who they purport themselves to be, that they are working where they said they would be and that their employers are paying them correctly (i.e., prevailing market wages). If the applicants and their sponsors did things by the book, there should be no surprises or problems.

However, these audits are occurring because there has been fraud in the visa process at some firms. If some frauds have been found without audits, I’ll bet more will be discovered now.

According to an InfoWorld piece 21% of visa petitions violate regulations/program rules.

Currently, the H-1B program is not getting the over-subscribed numbers of applicants as in past years. The economy is the key to this drop off. But, the program will regain popularity once the economy recovers.

When it does, a visa program that is fairly administered and legitimately used would benefit all of those who participate within it. If we have such a program, we cannot allow firms to offer sub-market pay to those who participate in the plan. This depresses wages for domestic workers and is grossly unfair to those non-citizen workers. Fraud is always wrong and those who try to justify it are skirting criminality.

Are these audits a bad thing? No. Are they overdue? Yes. Will new abuses be exposed to the bright light of day? Probably.

Topics: Banking, CXO, IT Employment

About

Brian is currently CEO of TechVentive, a strategy consultancy serving technology providers and other firms. He is also a research analyst with Vital Analysis.

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

19 comments
Log in or register to join the discussion
  • About time

    There are employers who have > 50% of their workforce as foreign workers. I can't imagine all of them are doing things according to the letter of the law.
    Joe Customer
  • RE: Use H-1B or L-1 workers? Prepare for a Federal audit!

    this is probably the only good thing to come out of this administration....enforce some labour laws.
    Linux Geek
  • Long overdue

    This is long overdue. I've seen a lot of people get "replaced" one way or another just so the company could save some money.
    saltysea
  • RE: Use H-1B or L-1 workers? Prepare for a Federal audit!

    I have been a contractor for years. I have lost jobs to H1B people that are unqualified to fill the job. The companies do not care as long as they have bodies. They end up killing the project since it is behind schedule. They could have hired two or three good Americans and had a working, completed project and saved money.

    I have seen more fake resumes than I care to remember. The headhunters will tell the H1B what they need and it will then appear in the H1B resume.

    The problem in the audit is that most of these companies will get their H1B who are working for a third party. The contract is between the company and the third party. That way the company can claim that they did not know the H1B was illegal and they are home free. The third party then folds up it office and opens a new office and continues doing the same thing.

    One of biggest users of HIB's is Fannie Mae and Freddie Mac. They have kick back and pay off to get place people in their data center.
    The Old Timer
    • The problem in the audit is that most of these companies will get their H1B

      [b][i]The problem in the audit is that most of these companies will get their H1B who are working for a third party. The contract is between the company and the third party[/b][/i]


      The regulations should be upgraded to include "Duty of Care" vicarious responsibility in the same way that a company is responsible for an unbroken chain of garbage disposal to a legitimate dump.

      Directors licensing should be enforced and personal liability applied to delete these fly-by-night employment agencies.
      Steve__Jobs
      • Exactly!

        It's the old WalMart dodge of "we don't hire illegal aliens" that's our subcontractor doing it.

        But if you blacklist the subcontracting firms,
        and make the cash fines large enough, you'll soon put the worst offenders out of business.

        And by all means blacklist H1B employee who falsified applications and prevent them from reapplying for at least 5 years.

        We also need new regulations which require H1B workers to receive the same average pay as a the average pay for an American worker with the same years of experience. This would prevent companies from using H1Bs just to reduce the IT payroll cost.
        aiguy@...
    • Fannie Mae, Freddie Mac and GSA

      These government entities should get rid of their H1-bs. American taxpayers pay for these agencies and should hire locals. Americans first and foremost.
      codeit
    • Mostly True

      I work in India and I know that the system is being abused by "body shopping" companies. Most of the resources we send there are not skilled enough to even develop simple software applications.

      It makes me wonder what these guys will do out there. I'm sure a lot of them will be sent back and I sure hope they do.
      arunitc@...
  • RE: Use H-1B or L-1 workers? Prepare for a Federal audit!

    Its about time. The H1B program is supposed to be about getting foreign workers with masters degrees and PHD's. Its amazing the number of people with post-graduate degrees from foreign countries evidently willing to work the help desk, and not being very good at that...
    abear4562
  • H1-b Destroying our Education System

    Have you ever heard that we are not educating enough people? As long as we keep allowing companies to use H1-b visas the demand for American Programmers will be low and colleges and Universities will get less interest in students wanting to be programmers because there is no demand in the job market for US Citizen Programmers. These actions and trends are bad for our education system and counter-productive for the United States of America.

    Next time someone mentions something about lack of programmers blame in on the H1-b System, not our education system. I work at a community college and we have just about completely done away with our program in CIS or programming skills. We are focusing on Networking skills instead. I think this is directly related to H1-b visas.
    ceh4702
  • Only S.887 will give us the chance to compete for job openings

    The transformation of DOL & USCIS from federal pussycats into 800lb guerillas is the Change we can believe in.

    However, it will only benefit citizens from abroad. The Durbin bill, S.887, will force employers to consider highly skilled American specialty workers before recruiting abroad. This is the Change we need.

    Take a look at the "H-1b Only" want ads that employers post to fill US job openings.

    www.brightfuturejobs.com

    Donna Conroy, Director
    Bright Future Jobs
    dmconroy
  • RE: Use H-1B or L-1 workers? Prepare for a Federal audit!

    Americans and Permanent Residents have been discriminated against. Companies use these visas to actively recruit only those that have them and don't allow locals to compete and apply for the jobs.

    The New Durbin Bill S887 will surely put a stop to that and allow Americans and Permanent Residents a chance to compete for these jobs.

    codeit
  • RE: Use H-1B or L-1 workers? Prepare for a Federal audit!

    The "intent" of this was good originally. The idea was to bring the best and brightest in the world to the US and eventually make US citizens out of them. Conceptually, that's a great idea. Now it is just too abused. Companies just bring these people in so they can pay them less than the going rate. AND they are not hiring the top level people. They are just filling traditionally "expensive" jobs with cheap foreign labor...time for it to go!
    ceiboss
  • RE: Use H-1B or L-1 workers? Prepare for a Federal audit!

    It is about time! Should have been doing it all along!
    ketrout
  • RE: Use H-1B or L-1 workers? Prepare for a Federal audit!

    With all the layoffs in the Tech sector in the past year the H-1B program should be suspended as unnecessary. Especially if these audits uncover widespread underpaying of participants, proving that companies are just using these visas to cut payrolls.
    mkreutzian
  • Another Big Government Attempt Intimidation of Business

    Fear your government.
    Albee_Freeoneday
    • as if BUSINESS has not been intimidating US workers??

      bout time GOVERNMENT intimidates business!!!
      WHY do you think unemployment is so high in tech sector?
      marysob@...
    • Good!

      I hope they scare the beejesus outta 'em...

      Let's put an end to imported slave labor
      Wintel BSOD
  • RE: Use H-1B or L-1 workers? Prepare for a Federal audit!

    I worked for a company that brought in 300 of these people a year, paid them a third of what I made and rented them out to the companies I worked for. Of course I was the first to go when the time came to reduce the work force . . . never was able to get another job because of my age and these modern day slaves . . . also they jump the visas and compete for the jobs that I should have gotten . . .
    rkersh