New H1B Visa Rules: TCS, Infosys Will Hire More Americans, Instead Of Sending Indians To US

With the new visa rules in place, India based IT firms are planning to increase in offshoring and local hiring as wages paid to visa holders are expected to go up owing to the latest rules proposed by the Trump administration.

In the same regard, last week, a proposal was submitted by the Department of Labour (DoL) to the Office of Information and Regulatory Affairs (under Office of Management and Budget).

What Does The Expert Say?

So far, the details are not available publicly.

But, according to the legal experts, this would affect the wage conditions of H1B, L1, and other non-immigrant visa holders.

The assistant vice-president, BOB Capital Markets, Ruchi Burde said, “In absence of details about the proposed wage changes, it’s difficult to quantify the impact on Indian IT companies, but it will certainly inflate the cost of H1B visa talent pool and may further increase offshoring and localization efforts of Indian IT players,”.

The founding partner, Avitr Legal, Raunak Singh said, “It appears that the DoL is increasing the wage level for the H1B category of visa holders, to bring it on a par with Americans,”.

Singh said, “The rationale behind this change seems to be that the US Government intends to promote employment of Americans. By bringing the wage levels of H1B visa holders on a par with Americans, the employers may not get the benefit of hiring foreign workers at lower wage rates.”.

How Does This Affect?

Following the move, several IT firms including Tata Consultancy Services, Infosys, Wipro, and HCL Technologies have started showing signs in increasing the offshoring efforts.

Along with that, they are also opting for local hires in the US, in order to avoid immigration-related challenges.

In the same line, Infosys has already announced at the start of this month that it would hire 12,000 American workers over the next two years, to have a 25,000-strong workforce in the US over five years. 

In response to this proposal, Industry body Nasscom has criticized the move, saying it alters the level-playing field for Indian IT firms. 

The vice-president and head of Global Trade Development at Nasscom, Shivendra Singh said, “The changes should not come as an interim final rule (IFR) as no one has the right to comment on it,”.

He said, “H1Bs, L1s, and work visas are a temporary way to bring in high-skilled visas. It is a trade issue and not an immigration issue as it does not alter the net immigration number.”

In the meantime in another development, the US has announced USD 150 million (over Rs 1,100 crore) on Thursday which will be invested in training for middle-to-high-skilled H-1B occupations in key sectors in the American economy.