Most H-1B Employers Use Programme To Pay Migrant Workers Well Below Market Wages: Report
A majority of H-1B employers, including major American technology firms like Facebook, Google, Apple and Microsoft, use the programme to pay migrant workers well below market wages, a new report has claimed.
"Among the top 30 H-1B employers are major U.S. firms including Amazon, Microsoft, Walmart, Google, Apple and Facebook. All of them take advantage of program rules in order to legally pay many of their H-1B workers below the local median wage for the jobs they fill," said the report released by the Economic Policy Institute.
Authored by Daniel Costa and Ron Hira, the report titled "H-1B visas and prevailing wage levels" says 60 percent of H-1B positions certified by the U.S. Department of Labor are assigned wage levels well below the local median wage for the occupation.
While the H-1B programme rules allow this, DOL has the authority to change it, but has not, it said.
While over 53,000 employers used the H-1B programme in 2019, the top 30 H-1B employers accounted for more than one in four of all 389,000 H-1B petitions approved by the U.S. Citizenship and Immigration Services in 2019, it said.
Half of the top 30 H-1B employers use an outsourcing business model to provide staff for third-party clients, rather than employing H-1B workers directly to fill a special need at the company that applies for the visa, the report said.
H-1B is a temporary non-immigrant work visa that allows U.S. employers to hire college-educated migrant workers as well as fashion models from abroad. Nearly 500,000 migrant workers are employed in the United States in H-1B status.
The report alleged that major U.S.-based technology firms that hire H-1B workers directly, rather than contract them out to third-party employers, had significant shares of their certified H-1B positions assigned as Level 1 or Level 2, the two lowest wage levels in fiscal 2019, both of which are below the local median wage.
"Until now, much of the public discourse and proposals for reforming H-1B have focused on rules that would constrain the practices of these outsourcing companies," the report said.
But researches reveal that many firms that employ H-1B workers directly, including some of the biggest names in the technology industry such as Amazon, Google, Microsoft, Apple, Qualcomm, Salesforce and Uber, pay a large share of their H-1B workers at one of the two lowest wage levels, Level 1 or Level 2.
In addition, these direct-hire firms also hire many H-1B workers on a contract basis through outsourcing firms, it added.
Microsoft, the seventh-largest H-1B employer in 2019, assigned one-third (35 percent) of its positions on Labor Condition Applications as Level 1 and two-fifths (42 percent) as Level 2. In total, Microsoft assigned more than three-quarters (77 percent) of its H-1B positions as Level 1 or Level 2, a wage level below the local median wage.
Microsoft assigned only 18 percent of its positions as Level 3 (the median) wage, and a mere three percent as Level 4, the only above-median wage level.
Amazon, which appears twice in the H-1B top 30, as "Amazon.com Services" (no. 4 among the biggest H-1B employers) and "Amazon Web Services" (no. 27), also assigned the vast majority of its H-1B positions at one of the two lowest wage levels.
According to the report, Amazon.com Services assigned 34 percent of its H-1B positions as Level 1 and 51 percent as Level 2, for a total of 86 percent of all positions certified.
Amazon Web Services assigned 47 percent of its H-1B workers as Level 1 and 36 percent as Level 2. Combined, Amazon.com Services and Amazon Web Services had 12,428 positions certified at Level 1 or 2, for a total of 85 percent certified at a wage level below the median. Only one in eight (1,684) were certified at or above the 50th percentile (Level 3 or Level 4), it said.
Apple, eleventh on the list, assigned 558 of its H-1B positions (two percent) as Level 1 and one-third (32 percent) as Level 2, for a combined total of 34 percent at Levels 1 and 2. Apple assigned 32 percent as Level 3 and 34 percent as Level 4.
Google, ranked the fifth-largest H-1B employer, had 9,085 H-1B positions certified by DOL in fiscal 2019. It assigned less than half of one percent of its certified H-1B jobs as Level 1 and 54 percent as Level 2. Only 37 percent of Google's jobs were certified at or above the median wage, the report said.
Facebook assigned only one position as Level 1 and 10 percent of its 6,118 total H-1B positions as Level 2. Twenty-five percent were certified at Level 3 and 16 percent at Level 4. Nearly half (49 percent) of Facebook's H-1B positions were certified at a wage established by an alternative wage survey, making it difficult to assess its H-1B wage distribution, the report said.
Uber, the 29th-ranked H-1B employer in 2019, had 5,708 H-1B positions certified by the DOL. Less than one percent were assigned as Level 1 and just over half (53 percent) as Level 2. Just over one-third were assigned as Level 3 and 13 percent as Level 4.
While Uber had 5,708 H-1B positions certified by DOL and hired 1,160 H-1B workers in 2019, in the same year, it made headlines by laying off 400 employees, including 125 software engineers, nearly half of whom were "senior" software engineers. The firm was hiring H-1B workers for the same types of positions for which it was conducting mass layoffs, the report alleged.
The report claims that the top 30 H-1B employers are in fact hiring H-1B workers to fill a very large number of routine (Levels 1 and 2) positions that require relatively little experience and ordinary skills.