H1B Exploitation? Apple, Facebook & Other US Firms Are Paying Less Money To H1B Visa Holders

According to the latest reports, a majority of H-1B employers, including major American technology firms like Facebook, Apple and Microsoft, use the program to pay migrant workers well below-market wages.

How Did This Happen?

As per the report released by the Economic Policy Institute, “Among the top 30 H-1B employers are major US firms including Amazon, Microsoft, Walmart, 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,”.

the report titled “H-1B visas and prevailing wage levels”, authored by Daniel Costa and Ron Hira, says 60 percent of H-1B positions certified by the US Department of Labor (DOL) are assigned wage levels well below the local median wage for the occupation.

Although the H-1B program rules allow this, DOL has the authority to change it, but has not, the report said.

How Is This Affecting?

In 2019, over 53,000 employers used the H-1B program, the top 30 H-1B employers accounted for more than one in four of all 389,000 H-1B petitions approved by the US Citizenship and Immigration Services in 2019, as per the report.

The report further says that 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.

Basically, H-1B is a temporary non-immigrant work visa that allows US employers to hire college-educated migrant workers as well as fashion models from abroad. 

Under this, nearly 500,000 migrant workers are employed in the United States in H-1B status.

Further, the report claims that major US-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.

The reports said, “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,”.

Although, researches reveal that many firms that employ H-1B workers directly, including some of the biggest names in the technology industry such as Amazon, 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.

Additionally, these direct-hire firms also hire many H-1B workers on a contract basis through outsourcing firms, it added.

It is noteworthy here as 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.