Bad news for Indian IT? Why proposed H-1B visa Bill has industry worried

The proposed US Bill -- Protect and Grow American Jobs -- is riddled with "onerous conditions" and places "unprecedented obligations" on both Indian IT companies and clients using H-1B visas, software body Nasscom has cautioned.

Nasscom said it has flagged its concerns around visa-related issues in the US with the Senators, Congressmen and the administration, and will engage further in a dialogue over the next few weeks over the proposed legislation.

The Bill proposes new restrictions to prevent abuse and misuse of H-1B visas. It tightens the definition of visa-dependent companies and imposes fresh restrictions in terms of minimum salary and movement of talent.

Apart from prescribing higher minimum wages, the Bill places the onus on clients that they will certify that the visa holder is not displacing an existing employee for a tenure of 5-6 years.

"That formulation has conditions which are extremely onerous and makes it very difficult for people to not just get the visa but also on how they can be used," R Chandrashekhar, President, National Association for Software and Services Companies (Nasscom) told PTI.

There is no doubt we have been seeing an increasingly negative environment and this is a part of the protectionist, anti-globalisation trend: R Chandrashekhar, President, Nasscom

The Bill has been passed by the House Judiciary Committee and is now headed for the US Senate.

"We do not know the exact timeline but we have been told it will come up early 2018," he said.

Chandrashekhar said another "extreme concern" is that "in the name of protecting American jobs, this has been applied only to the so-called visa-dependent companies that translates to Indian companies".

"There is no doubt we have been seeing an increasingly negative environment and this is a part of the protectionist, anti-globalisation trend," he said referring to a slew of measures taken by the US in the recent past, including increased visa scrutiny, premium visa processing being put on hold for a few months, etc.

Chandrashekhar also pointed out that the use of visas by Indian IT firms has fallen by 50 per cent in the last two years and that the number now stands below 10,000.

"It is below 10,000, which is a minuscule fraction of 85,000 visas (H-1B visas) issued every year... how such onerous restrictions on 12-15 per cent of the visas that are being issued protect American workers, certainly defies logic," he said.

Chandrashekhar explained that the Bill proposes to raise the minimum wage substantially to about $100,000 if the company has to be exempted from the labour certification requirements.

Also, the client deploying the H-1B visa worker will have to certify that no American worker will be displaced for the 5-6 year period.

Further, the software services provider will have to notify the US authorities if the client has displaced a worker, an obligation that is unprecedented, he said.

Chandrashekhar added that many of these changes were "emotive and political" rather than being based on "economic arguments".

He said that Nasscom has shared its concerns with both Indian and the US governments.

"...We will probably be having further interaction in next few months. In next couple of months, we expect to have interactions once again with the US authorities," he added.