US Senator Charles Schumer calls Infosys 'chop shop' Read more: US Senator Charles S

[dee]

NEW YORK/NEW DELHI: Criticising companies outsourcing highly-paid American jobs, a US Senator has described Indian IT major Infosys as a "chop shop", a place where stolen cars are dismantled and parts sold separately.

The comments were made by Democrat Senator of New York Charles E Schumer during discussions on the Border Security Bill, a $600-million emergency package aimed at strengthening security along the porous Mexican border.

"The emergency border funds will be paid for by assessing fees on foreign companies known as chop shops that outsource good, high-paying American technology jobs to lower wage, temporary immigrant workers from other countries.

"These are companies such as Infosys," Schumer said on the Senate floor on Thursday.

The comments made during the discussion are posted on the Senate website.

When contacted, an Infosys spokesperson said the company would not like to comment on the Senator's remarks.

Schumer also pointed out the bill would not affect the high-tech companies such as Intel or Microsoft that play by the rules and recruit workers in America.

The $600 million-spending bill approved by the Senate would see significant hike in application fees for H-1B and L1 visas, which are most sought after by Indian IT professionals.

The proposed bill would hike the visa fee to $2,000 per application on those entities that have less than 50 per cent of their employees as US citizens.

Infosys has thousands of employees in the US. For the three months ended June 30, the company had raked in 67.3 per cent of its total revenues from North America.

After the passage of the bill in the Senate, Democrat Senator of Missouri Claire McCaskill on Thursday said the proposal would increase fees for particular companies that exploit two categories of visas - H-1B and L.

"A handful of foreign-controlled companies that operate in the United States - such as Wipro, Tata, Infosys and Satyam - rely on H-1B and L visas to import foreign workers to the US.

"The Senate Democrats' border security proposal would increase the visa fees paid by these companies by roughly USD 2,000 per visa application," she had said in a statement.



US Senator Charles Schumer calls Infosys 'chop shop' - India Business - Business - The Times of India

 

[dee]

U.S. Senate hikes visa fees of Indian firms


Washington: The United States Senate has passed a border security bill that will raise the visa fees of Indian companies operating in the U.S. by $2,000 or more, a move that may seriously impact the operations of IT-focussed companies such as Infosys, Wipro and the Tata Group.

The text of the bill for emergency supplemental appropriations for border security, likely to be taken up in the House of Representatives next week, says that until September 2014, “The filing fee and fraud prevention and detection fee required to be submitted with an application for admission as a non-immigrant... shall be increased by [$2,250 or $2,000 depending on the profile of the company] for applicants that employ 50 or more employees in the U.S. if more than 50 per cent of the applicant's employees are non-immigrants.”

The National Association of Software and Services Companies (NASSCOM) sharply criticised the bill, estimating the impact on Indian companies could be as high as $200 million to $250 million per annum.

In a statement, Som Mittal, president of NASSCOM, said: “The money to pay for this increase would come primarily from raising fees on H-1B and L-1 visas for highly skilled workers. While we understand the need for heightened border security, we believe that the extra fees will produce negative consequences for both U.S. and Indian companies.”

Arguing that the legislation will send the message that foreign workers are not welcome in the U.S., Mr. Mitall emphasised that the $1 billion-plus that Indian firms and Indian citizens paid each year to the U.S. in the form of social security taxes with no benefit or refund would be lost to the U.S. Treasury if this bill became law.

He warned that the bill was an “indirect form of protectionism and runs contrary to the Obama administration's oft-repeated goal of opening markets and doubling U.S. exports.” Reflecting on possible negative consequences of this bill for even the U.S. economy, Mr. Mittal said the legislation would lead to diminished inflow of Indian talent to the U.S., and that would adversely affect the U.S.' technological innovation capabilities.

The New York Times quoted Senate aides saying that under the bill, which was proposed by Democrat Charles Schumer of New York, four Indian companies would qualify for the significantly higher fees: Tata, Infosys, Wipro and Mahindra Satyam.

Infosys spokesman Peter McLaughlin was quoted as saying, “It is unfortunate that this tax is being levied on a discriminatory basis when the need is to open markets to make companies more competitive in the global marketplace.”

Yet some Senators strongly supported the bill; for example Democratic Senator Claire McCaskill of Missouri reportedly said: “I'm thrilled that these companies are complaining about having to hire more Americans... That is the whipped cream and cherry on top of this sundae.”




The Hindu : Front Page : U.S. Senate hikes visa fees of Indian firms

 

[RobbieS]

Somebody said something about protectionism?

 

[banned]

The Indian outsourcing industry has not bought any benefit to US market. Its a one way street which benefits corporations only because the consumer price of services remains the same wether it is manned by american or offshore Indians. So by all means, it is nothing but unfair profit making scheme. Secondly is the Indian immigrant IT workers. Beside the failure of Windows vista and entire microsoft 2007 year product lineup, these indians also work for cheap as much as 1/3 of nominal american pay while the cost of finish product remains the same leveraging unfair profit to corporations once again. If you are paying and american price, you should get an american quality.

Shall i say this could be the fall out from narrowing down to european companies in MRCA tender?

 

[nForce]

NEW YORK/NEW DELHI: Criticising companies outsourcing highly-paid American jobs, a US Senator has described Indian IT major Infosys as a "chop shop", a place where stolen cars are dismantled and parts sold separately.

The comments were made by Democrat Senator of New York Charles E Schumer during discussions on the Border Security Bill, a $600-million emergency package aimed at strengthening security along the porous Mexican border.

"The emergency border funds will be paid for by assessing fees on foreign companies known as chop shops that outsource good, high-paying American technology jobs to lower wage, temporary immigrant workers from other countries.

"These are companies such as Infosys," Schumer said on the Senate floor on Thursday.

The comments made during the discussion are posted on the Senate website.

When contacted, an Infosys spokesperson said the company would not like to comment on the Senator's remarks.

Schumer also pointed out the bill would not affect the high-tech companies such as Intel or Microsoft that play by the rules and recruit workers in America.

The $600 million-spending bill approved by the Senate would see significant hike in application fees for H-1B and L1 visas, which are most sought after by Indian IT professionals.

The proposed bill would hike the visa fee to $2,000 per application on those entities that have less than 50 per cent of their employees as US citizens.

Infosys has thousands of employees in the US. For the three months ended June 30, the company had raked in 67.3 per cent of its total revenues from North America.

After the passage of the bill in the Senate, Democrat Senator of Missouri Claire McCaskill on Thursday said the proposal would increase fees for particular companies that exploit two categories of visas - H-1B and L.

"A handful of foreign-controlled companies that operate in the United States - such as Wipro, Tata, Infosys and Satyam - rely on H-1B and L visas to import foreign workers to the US.

"The Senate Democrats' border security proposal would increase the visa fees paid by these companies by roughly USD 2,000 per visa application," she had said in a statement.



US Senator Charles Schumer calls Infosys 'chop shop' - India Business - Business - The Times of India

I don't really understand what is the Indian connection that the Senator found out in relation to the bill.Well now,the Indian professionals who go on deputation to US to work for companies there with less than 50 percent US employees will be affected.But that will not necessarily boost US employment there.It means it will,in a way give one more reason to these companies to outsource jobs in foreign countries.

 

[RobbieS]

The Indian outsourcing industry has not bought any benefit to US market. Its a one way street which benefits corporations only because the consumer price of services remains the same wether it is manned by american or offshore Indians. So by all means, it is nothing but unfair profit making scheme. Secondly is the Indian immigrant IT workers. Beside the failure of Windows vista and entire microsoft 2007 year product lineup, these indians also work for cheap as much as 1/3 of nominal american pay while the cost of finish product remains the same leveraging unfair profit to corporations once again. If you are paying and american price, you should get an american quality.

Shall i say this could be the fall out from narrowing down to european companies in MRCA tender?

You cant be more wrong. Let me show you how -

Outsourcing helps US companies stay competitive. If it werent for cost saving strategies like outsourcing many US organizations would have gone under.

If a 50,000 employee company outsources 500 jobs it saves the jobs of the rest of the 49500 folks by staying afloat for a longer time.

US companies aren't run by fools. They dont compromise quality for price. Untill and unless they are satisfied with the quality, nothing is outsourced.

Outsourcing is here to stay simply because companies have to stay competitive and people in developing countries offer them cost saving options without compromising on quality.

And I'm going to disregard your nonsensical rant on Windows, MRCA and what not!

 

[Ras]

I don't really understand what is the Indian connection that the Senator found out in relation to the bill.Well now,the Indian professionals who go on deputation to US to work for companies there with less than 50 percent US employees will be affected.But that will not necessarily boost US employment there.It means it will,in a way give one more reason to these companies to outsource jobs in foreign countries.

Yes..but the companies who do not hire in the US at all do not increase US employment in any way... companies like Infosys as he mentioned. They rotate people in and out of the US. These people do not want or put down roots in the US.They are just here to make quick bucks and learn the trade.

Infosys should hire more Americans in America.

---------- Post added at 08:23 PM ---------- Previous post was at 08:22 PM ----------

The Indian outsourcing industry has not bought any benefit to US market. Its a one way street which benefits corporations only because the consumer price of services remains the same wether it is manned by american or offshore Indians. So by all means, it is nothing but unfair profit making scheme. Secondly is the Indian immigrant IT workers. Beside the failure of Windows vista and entire microsoft 2007 year product lineup, these indians also work for cheap as much as 1/3 of nominal american pay while the cost of finish product remains the same leveraging unfair profit to corporations once again. If you are paying and american price, you should get an american quality.

Shall i say this could be the fall out from narrowing down to european companies in MRCA tender?

This has nothing to do with Microsoft nor is Microsoft affected by it so I do not understand what Vista has to do with it.

The outsourcing in the IT field is just like how manufacturing got shifted out to China..purely for cost.

 

[Archie]

To tell the american Senator
Apple computers which recently took over as the biggest IT company of USA with a Market cap of 248 Billion USD
Gets all of the manufacturing of the Iphone , Ipods, Ipads through contract from manufacturers in China and Taiwan
Is it also not outsourcing Considering that Apple has a revenue of 50 Billion USD compared to the entire indian IT industry comprising of TCS , INFOSYS , WIPRO , SATYAM , HCL ,which together earn a revenue of 65 billion USD

 

[karan.1970]

The Indian outsourcing industry has not bought any benefit to US market. Its a one way street which benefits corporations only because the consumer price of services remains the same wether it is manned by american or offshore Indians. So by all means, it is nothing but unfair profit making scheme. Secondly is the Indian immigrant IT workers. Beside the failure of Windows vista and entire microsoft 2007 year product lineup, these indians also work for cheap as much as 1/3 of nominal american pay while the cost of finish product remains the same leveraging unfair profit to corporations once again. If you are paying and american price, you should get an american quality.

Shall i say this could be the fall out from narrowing down to european companies in MRCA tender?

Nah.. This story starts 2 years before every election in USA. Fizzles out right after the elections. 2 years are peaceful and starts again. Working for a bunch of outsourcing giants, I can tell you, this has zero impact on the companies being talked off. Similar tamasha happened after Obama's comment around jobs in Buffalo vs jobs in Bangalore..

 

[karan.1970]

Yes..but the companies who do not hire in the US at all do not increase US employment in any way... companies like Infosys as he mentioned. They rotate people in and out of the US. These people do not want or put down roots in the US.They are just here to make quick bucks and learn the trade.

Infosys should hire more Americans in America.

The key staff of Infosys is based in the USA. Most of the senior relationship managers and VPs are based in the US and are US citizens. Average tenure of a Relationship VP from Infosys (based in the US) is over 10 years. Its actually the delivery team in India that has a higher rotation and attrition rate.

 

[Ras]

The key staff of Infosys is based in the USA. Most of the senior relationship managers and VPs are based in the US and are US citizens. Average tenure of a Relationship VP from Infosys (based in the US) is over 10 years. Its actually the delivery team in India that has a higher rotation and attrition rate.

The vast majority of Infosys IT engineers rotate...if more than 50% of their US employees are citizens they have nothing to worry about. But that is not the case is it?

 

[karan.1970]

The vast majority of Infosys IT engineers rotate...if more than 50% of their US employees are citizens they have nothing to worry about. But that is not the case is it?

So I am not talking of the junior staff here but key executives. As I said, the delivery manpower is based in India and if required goes to US for short stints. The relationship managers or senior client executives are mostly US based and are permanent residents/citizens of the US.

The total manpower wise you are right that they dont meet the 50% criteria..

 

[nForce]

Yes..but the companies who do not hire in the US at all do not increase US employment in any way... companies like Infosys as he mentioned. They rotate people in and out of the US. These people do not want or put down roots in the US.They are just here to make quick bucks and learn the trade.

Infosys should hire more Americans in America.

It will be a bit of overstatement to say that companies like Infosys don't hire at all in client countries,like US.It is not like these companies maintain an office which is an Island full of Indians in US.They do hire local man power and maintain a healthy ratio.

It would be naive for all of us if we start judging companies based on their roots.After all a company has to originate from somewhere,not from thin air.Companies like Toyota have excellent market in US or India.But that does not make them move out from Toyota City,Aichi,Japan.

Finally,we should have a study about how much more local hiring will be enough??Is there any US law dictating terms and conditions??

 

[Ras]

It will be a bit of overstatement to say that companies like Infosys don't hire at all in client countries,like US.It is not like these companies maintain an office which is an Island full of Indians in US.They do hire local man power and maintain a healthy ratio.

It would be naive for all of us if we start judging companies based on their roots.After all a company has to originate from somewhere,not from thin air.Companies like Toyota have excellent market in US or India.But that does not make them move out from Toyota City,Aichi,Japan.

Finally,we should have a study about how much more local hiring will be enough??Is there any US law dictating terms and conditions??

The current change in the H1 rules say 50%.

 

[Justin Joseph]

How this thread is related to India Defense section????????