Issa bill would kill a big H-1B loophole | Hacker News Reader

Issa bill would kill a big H-1B loophole

computerworld.com

36 points_of20 comments

The proposal is to raise the minimum salary for H1B visas from $60,000 to $100,000 for employers with over 15% H1B staff.

There is an obvious loophole here. Large employers of Americans like IBM (or Walmart or UPS or Aramark or even Taco Bell) [1] could hire H1Bs at the lower rate of $60,000 and rent them to third parties like Infosys and Tata do today.

For context Walmart employs 2.1 million people [1]. 15% of that is 350,000. There are approximately 650,000 H1Bs working in in the United States [2]. So, Walmart alone could employ about half of H1Bs at the lower rate of $60,000.

I expect this law would have little to no effect on the total number of H1B workers employed below $100,000.

[1] https://en.wikipedia.org/wiki/List_of_largest_employers_in_t... [2] http://cis.org/estimating-h1b-population-2-11

I've never seen a good argument against running it as an auction where the highest salaries offered win.

How would this help keep tech salaries down?

IT companies would probably pay 100k on paper and ask 40k back from their employees. Laws like this don't stop companies who abuse the system.

>ask 40k back

how?

You'd be surprised at length Indian companies go to win contract and employees to get a chance to get out of India. Its nothing short of slavery.

People in western world think 9 percent unemployment rate is high; Now just think about close to 80 percent unemployment rate in chosen field of study. In such environment competition is so intense to get and hold a job, employees would do anything that companies tell them to. Including passing the 40% salary back to company under the table.

This happens with the current system already. They get found out and charged accordingly.

Yeah but did it make any difference? Fine for abusing H1B is so low that its laughable.

I've never heard of this. How would it work? I assume that the $100K would be W2 income (a requirement for corporate sponsorship) and all of the related income taxes for both the employer and employee are paid up. How would the IT company get paid back without having to report this as something like sales income/revenue? Unless the "boss" is getting a personal cash kick-back under the table, I don't understand how this could even happen. If the "boss" is not the sole shareholder this is both extortion against the employee and embezzlement against the company - and probably tax evasion. If the sole shareholder, then still extortion and (probably) tax evasion.

Companies who do this ask their employees to pay back in inr in India. Companies settle this with some creative accounting. Regulations for financial reporting are a joke in India. Google it for details.

Really? That's kinda ... sleazy. And against US law. I'm assuming nobody reports it because nobody wants 100% of that company's H1B visas (including their own visa!) to be revoked in the US?

Yup. Sleazy is an understatement.

http://www.nbcbayarea.com/investigations/Silicon-Valleys-Bod...

Seems like a pretty reasonable measure to increase the minimum salary to $100k since the original stated purpose of the H1B visa was to bring in extraordinary talent and expertise that couldn't possibly be found in the US. I can't imagine what any sincere, non self-serving arguments against it would be.

It seems an argument against this bill is that the salary limit should be more like $125K or $150K. That is to say the criticism is: this bill masquerades as a meaningful reform but won't have much actual impact.

Right, or it just shifts the problem. Instead of replacing our $100k employee with a $60k H-1B, now we can afford to replace our $140k employee with a $!00k H-1B

But you could have done that before.

You wont be able to do that if the employee is that good he will get poached for a higher salary.

And non-profits? Salary is not a measure of talent.

Non-profits don't have a quota cap.

>Salary is not a measure of talent.

No, but it is a good measure of scarcity. And H1B holders are supposed to have skills that are completely unavailable in the US.

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