Will the White House disappoint on H-1B displacements?

Signals are mixed on whether the Obama administration will take action or wait for Congress to change the law.

A top White House official told House lawmakers this week that the replacement of U.S. workers by H-1B visa holders is troubling and not supposed to happen. But it is hard to tell whether the administration will do anything about it. The signals are mixed.

Several federal agencies, at the request of lawmakers, are investigating complaints by IT workers at Southern California Edison, Disney Parks and Resorts and some other firms, that they had to train H-1B workers prior to their layoff.

This isn't a new development. IT workers have been training their foreign replacements for years, but something in the national landscape has changed. Offshore outsourcing is reaching deeper into the U.S. economy. Regulated utilities, which rely on U.S. rate payers for revenue, are shifting jobs to India and laying offIT workers. The offshoring of IT workers by Disney, the quintessential wholesome American icon, struck a nerve.

The use of foreign labor may also be reaching deeper into government IT, as demand for H-1B visas reaches new highs. The problems with the program are also gaining new attention, as IT workers increasingly share their stories of being forced to train their H-1B replacements.

This week, Jeh Johnson, the secretary of the U.S. Dept. of Homeland Security, which oversees immigration, was asked at a House Judiciary Committee hearing about the use of H-1B visa holders to replace U.S. workers.

U.S. Rep. Jerrold Nadler (D-NY) cited the Disney layoffs at this hearing. He said that if H-1B workers are being used to replace U.S. workers, then "it's a very serious failing of the H-1B program."

Johnson's response was nuanced. He said H-1B workers "are not supposed to replace Americans," and "any such allegation is very troubling to me."

Johnson also agreed with U.S. Rep. Hakeem Jeffries (D-NY), who at the hearing asked whether it was correct that the H-1B program is only supposed to be used "when American workers are not otherwise available."

But Johnson also said that "I also believe Congress can help in this regard," said, "Congress can help through increased enforcement mechanisms for situations where an employer does in fact replace American workers with H-1B holders -- that is the recommendation that has been made to me and I support that."

Here is a plain English translation of Johnson's remarks: He is telling lawmakers that using foreign workers to replace U.S. workers is wrong. But he also telling them that it may be legal unless Congress changes the law.

Johnson isn't the first administration official to point out to Congress that it's the law, not the enforcement of the law, that's the problem.

The U.S. Department of Labor, in a letter to senators in April about the situation at Edison, explained that "even (H-1B) dependent employers and willful violators are not prohibited from displacing U.S. workers" provided they agree to pay at least $60,000 per year for the worker, or the foreign worker has a relevant master's degree. (A large H-1B employer can earn the dependent designation if H-1B workers make up 15% or more of their workforce.)

If the White House concludes its investigations into Edison and Disney by telling lawmakers that the law needs to be changed before it can do anything, a new problem arises.

Any H-1B-related legislation to stop displacement will likely be coupled with an H-1B cap increase. The tech industry will also lobby hard to ensure that any changes to the law are ineffective and filled with as many loopholes as possible.

Ron Hira, an associate professor of public policy at Howard University who has testified before Congress multiple times on H-1B visa use, believes the White House has the authority under the law as it now stands to make changes. He said Johnson's acknowledgement of the problem was a good first step.

"The intent of the H-1B program is very clear: It should only be used to fill positions when American workers are not available," said Hira, but "some in the administration have tried to hide behind the bizarre interpretation that H-1Bs can be used to displace American workers. ... There's an explicit affirmation in the statute that H-1Bs should not be used to harm American workers' wages and working conditions."

The Disney and Edison cases "make it plainly obvious that the leading H-1B employers are using the program to replace American workers and for wage savings from cheaper H-1B workers. It is time for the Obama Administration to act on principle and law to correct the widespread injustices," said Hira.

At worst, said Hira, "there's a conflict between the displacement interpretation and the legal, and common-sense, intent of the program. The administration has authority to select the interpretation that is sensible rather than the one with tortured logic."

Hira said the only reason Secretary Johnson was asked at this hearing about this issue "is because of the courageous Disney and Southern California Edison workers who were willing to tell their stories to journalists."

"It is time for more workers to come forward, anonymously, so that the American public sees the extent of the abuse, and to force the hand of politicians like Secretary Johnson to act," said Hira, who urged affected workers to contact him.

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