How outsourcing companies are exploiting US H-1B visa program

Many of the visas are given out through a lottery, and a small number of giant global outsourcing companies had flooded the system with applications, significantly increasing their chances of success.

Congress set up the H-1B program to help US companies hire foreigners with exceptional skills, to fill open jobs and to help their businesses grow. But the program has been failing many US employers who cannot get visas for foreigners with the special skills they need.

Instead, the outsourcing firms are increasingly dominating the program, federal records show. In recent years, they have obtained many thousands of the visas – which are limited to 85,000 a year – by learning to game the H-1B system without breaking the rules, researchers and lawyers said.


In some years, a US employer could snag one of these coveted visas at almost any time of the year. But recently, with the economy picking up, the outsourcing companies have sent in tens of thousands of visa requests right after the application window opens on April 1. Employers who apply after a week are out of luck.

“The H-1B program is critical as a way for employers to fill skill gaps and for really talented people to come to the United States,” said Ronil Hira, a professor at Howard University who studies visa programs. “But the outsourcing companies are squeezing out legitimate users of the program,” he said. “The H-1Bs are actually pushing jobs offshore.”

Those firms have used the visas to bring their employees, mostly from India, for large contracts to take over work at US businesses. And as the share of H-1B visas obtained by outsourcing firms has grown, more Americans say they are being put out of work, or are seeing their jobs moved overseas.

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Of the 20 companies that received the most H-1B visas in 2014, 13 were global outsourcing operators, according to an analysis of federal records by Hira. The top 20 companies took nearly 40 per cent of the visas available – about 32,000 – while more than 10,000 other employers received far fewer visas each. And about half of the applications in 2014 were rejected entirely because the quota had been met.

The top companies receiving H-1B visas in recent years, Hira found, include Tata Consultancy Services, known as TCS, Infosys and Wipro, all outsourcing giants based in India; Cognizant, with headquarters in New Jersey; and Accenture, a global operation incorporated in Ireland.

Among the immigration visas offered by the United States, the H-1B program stands out for its peculiar rules. The annual quota includes 65,000 visas for foreign workers applying for the first time, while the remaining 20,000 are for foreign students graduating with advanced degrees from US universities. Each year the period for applications opens on April 1, and they are accepted on a first-come, first-served basis.


Federal officials allow only one application for each foreign worker. But there is no limit on the number of visas a single company can seek. A company with thousands of employees can submit many applications. By law, if applications quickly exceed the quota, officials turn to a computer-run lottery to select the visa recipients.

Immigration officials do not acknowledge the outsourcing companies’ advantage and how they have understand the lottery game. Because of the lottery scheme post 2013; they have started putting so many more applications than they need just to improve their winning chances.


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