No H-1B visas? No problem, we'll offshore says Tech Mahindra

Indian tech services company Tech Mahindra last week revealed that US president Donald Trump's tightening of H-1B visas for skilled workers will be a minor irritant at worst, and perhaps an opportunity to send more jobs offshore. Speaking during the company's FY17 results announcement, vice chairman Vineet Nayyar said "... …

[Anonymous Coward]

Effectively the current H1-B abuse lead to offshoring anyway

Instead of taking the work offshore, you are bringing the worker from offshore to where the work is, then more often than not sending that person home after the job is over.

Also, I like how Tech Mahindra admits that there are plenty of engineers available in the U.S., but they just charge too much. The replacement of more expensive American IT workers with cheaper overseas workers in not what the H1-B program is supposed to be about. It is supposed to be about getting workers to fill roles that cannot be filled domestically.

Cutting back on H1-B abuse is not a silver bullet, but it is a step forward.

[EveryTime]

Everything that can be effectively off-shored is being off-shored anyway.

From what I've seen, H1-B employees are generally less qualified and less experienced, but are willing to work for enough less that it's cheaper to train them to replace local workers.

[Anonymous Coward]

Offshoring is already happening

The European branch of my company is regularly receiving people who didn't win the US visa lottery. Some of them eventually move to the US, some of them decide to stay.

The European office has doubled in size, and is planned to double again by 2020.

[Anonymous Coward]

Simple government response...

Subject all code developed off shore to import and customs duties.

And this is on-shoring, not off-shoring.

> The European branch of my company is regularly receiving people who didn't win the US visa lottery.

That sounds more like on-shoring, and the obvious solution is for governments to ban the use of foreign staff.

The stupid argument that we need them because we have pensioners to pay or there's a supposed skills gap is just replacing a medium term problem with a permanent one.

[DavCrav]

Re: Simple government response...

"Simple government response...

Subject all code developed off shore to import and customs duties."

OK. What if other countries do this?

[James 51]

Re: Simple government response...

Subject all code developed off shore to import and customs duties.

This one is so illy throught through it's hard to know were to start. Instead of having someone in the USA write the back end code for a webpage, it's written and hosted outside the US. Company in the US logs in uses page. How much do you charge? Will the difference for external facing, products and internal only use be worked out? Will it be a one off fee or will customs effectively be collecting rent on other peoples property?

What about source code and compiled code? Byte code? Will commerical programs be subject to that tax when they are imported even if the company that developed it has zero presence in the USA?

[Brewster's Angle Grinder]

Re: Simple government response...

"[A webpage is] written and hosted outside the US. Company in the US logs in uses page. How much do you charge?"

The first thing would be to determine whether duty was even due. Imagine a lengthy rulebook that determines whether a service is SAAS or something else (e.g. logging into a medical database might not count---since the software is incidental to the service provided---but logging in to Office 365 clearly would). That might push companies into purchasing the end service, rather than buying software and employing locals to provide it.

If duty was due, it could be a flat tariff. But it would more likely be a percentage of the price. That's easy to see if there's a purchase. But if the service was provided internally, from a foreign arm, then accountants would be required to concoct a price -- with plenty of paperwork to support their assertions. Or perhaps companies would switch to free software, and donate to open source devs in foreign lands.

[James 51]

Re: Simple government response...

How would that account for the cloud when programs and data might get moved around the world without the user being the wiser? Will you have to pay every time it lands in the US? Of course the company could just say it cost $0 as there is no invoice and a 100% tax on zero dollars will yield zero dollars. If that is an externally hosted service like Office365, who pays? Microsoft or the company buying the service?

[Anonymous Coward]

Re: Simple government response...

To all the unimaginative:

@James 51

> This one is so illy throught through it's hard to know were to start. Instead of having someone in the USA write the back end code for a webpage, it's written and hosted outside the US.

> How would that account for the cloud

and

@Brewster's Angle Grinder

> The first thing would be to determine whether duty was even due. Imagine a lengthy rulebook that determines whether a service is SAAS or something else

The service provider pays. How they charge the customer is up to them.

Wasn't that obvious? Clearly not to you...

@DavCrav

> OK. What if other countries do this?

You mean if American companies in India started off-shoring to America?

Hahahaha.

You didn't think that through, did you.

[allthecoolshortnamesweretaken]

Re: Simple government response...

The WTO would like to have a word with you.

[lglethal]

Trump is against offshoring...

... except when it comes to his own brands of course...

[Anonymous Coward]

H1Bs have an easy fix no one talks about

Raise the salary cap. A lot. If it was say $150K, and adjusted to the cost of living for the area the worker would be based in (i.e. it would be even more in SF or NYC) you'd see it work as intended. It would cost a lot to pay an H1B, so they'd only be used for jobs requiring special skills that US workers don't have, or where the demand for US workers greatly exceeds the supply.

Then they wouldn't need a cap, or a lottery, because the number of applications would be determined by the market, rather than how much money you could save bringing in cheap workers from overseas.

[Anonymous Coward]

Re: H1Bs have an easy fix no one talks about

They would just move the work overseas that much quicker. Why fight it eh? All the IT work in the world seems to be heading for India so go with the flow.

My job went and you know what, I feel good. Less stress and certainly no more fighting the inevitable and when my old boss comes calling because the output from India is so bad, I'll go back at twice the salary for at most 9 months. Then it will be time to get my pension. Then I won't care really.

[conel]

Re: H1Bs have an easy fix no one talks about

An auction seems like the obvious solution to me. Limit the number of visas and whoever pays the highest salaries gets them.

[Anonymous Coward]

Regarding the post-BREXIT situation in the UK. India has already indicated that they expect any future trade deals to include increased access to the UK job market for Indian immigrants. Tory minister Priti Patel has also endorsed that approach to replace EU workers in the UK.

[James 51]

The number of immigrants from outside the EU have always been greater than those from within it so no change there (though how will the Tories squard that with 99,999 people in a year?).

[Anonymous Coward]

Anyone else smell more than a whiff of hypocrisy- if not utter racism- from Priti Patel using and exploiting the immigrant-phobic Leave campaign as an excuse to let more people from the Indian subcontinent in?

People who- entirely coincidentally- include those sharing her own ethnic background (i.e. Gujurati Indian)?

"Yes, it's terrible all those East Europeans are coming to our country, and I'd like your vote to keep them out... so that I can let more of my own people in."

Is that it, Priti?

[Anonymous Coward]

Priti Patel's argument in the BREXIT campaign was that immigrants from the EU have no historical links with the UK. On the other hand she said that the Indian subcontinent has long historical ties through the British Empire and then the Commonwealth.

It depends on which time perspective you choose. The UK is composed mainly of the descendants of waves of immigrants from Europe over millennia.

[Anonymous Coward]

Moar Indian Codings!

Cool. Just what we need.

[Anonymous Coward]

USA has no problems with mahindra offshoring bluff we will just impose 35% extra duty

USA has no problems with mahindra offshoring bluff we will just impose 35% extra duty on every tech mahindra product or service, this 35% will be on the top of regular taxes, and tech Mahindra will be included into the blanket list who can not even apply for any H-1B, L1, or CG etc. and all the existing approved H1B visa holders will be cancelled immediately as this is the right of American citizens to make any policy for our country like tech Mahindra has the right to offshore their jobs to their country india.

If they want to do that welcome go ahead and do that!

[Brewster's Angle Grinder]

Re: USA has no problems with mahindra offshoring bluff we will just impose 35% extra duty

We could attempt to explain why this approach would be bad, but I'm not sure your brain would cope.

(Question for experts: would the US constitution allow tariffs to be applied unilaterally to one company?)

[Anonymous Coward]

Re: USA has no problems with mahindra offshoring bluff we will just impose 35% extra duty

You could definitely explain if you had any brain in your head!

For your information, the constitution of the USA is written by the citizens of USA, and our citizens are free to interpret and amend it according to our needs.

tech Mahindra is free to offshore their jobs to their country india, we have no issues with that, but we are also 100% FREE to impose taxes on all Mahindra products and all services and also we are fully authorize to reject visas to them and cancel all the guest workers visas immediately.

[Antron Argaiv]

Even a blind pig...

I despise Trump, and all he stands for.

However, he's right on this one, and he alone is talking about it. Seems strange, what with all his appointments of industry advocates to cabinet posts, but...there you go.

The sooner the "H-1B's are cheaper than Americans" scam ends, the better for all of us. If you want to base your business in the US, you should be hiring US employees, at the going rate, not alleging there's a shortage, and importing cheaper workers from overseas. And shame on Congress for letting it go on for so long (has nothing at all to do with bribes from industry"campaign contributions", I'm sure)

[Anonymous Coward]

Re: Even a blind pig...

> I despise Trump, and all he stands for. However, he's right on this one, and he alone is talking about it.

He's not the only one talking about. This article mentions 3 bills which have been introduced recently:

https://www.theregister.co.uk/2017/01/31/trumps_h1b_plan_leaks_american_techies_first/

[Antron Argaiv]

Re: Even a blind pig...

I'll wait and see if those bills go anywhere.

Congress has known about this scam for years (at least 20), and has done nothing significant to kill it. Must be pressure from those big tech companies to keep things as they are.

[Hollerithevo]

Re: Even a blind pig...

I do keep raising this, but Trump does nothing about H-2B visas, which bring in, for example, bar-staff and waitresses and cleaners for hotels. Trump hotels, including the 'Beach White House' has LOTS of H-2B visa-holders on staff. And yet there are more poor Americans who could really use these jobs than there are qualified tech engineers for the specialist positions. Help the little guys who voted for you, Trump; end H-2B visas and give all your hotel (and construction) jobs to Americans, given that this is what they voted you in to do.

[Anonymous Coward]

Re: Even a blind pig...

> I despise Trump, and all he stands for.

> However, he's right on this one,

So you don't despise all he stands for.

[Brock Landers]

Does anyone know the little known fact...

...that years ago the likes of SAP, MS and a ton of other Western tech giants handed out free software licenses to Indian 'colleges' and 'universities' with the view to drive down the TCO of their products? That TCO being salaries paid to Western IT workers. Yes, whilst education outfits in the West had to pay for MS and SAP software licenses (at a discount), in India they were dished out for free.

The whole thing was planned out years ago.

Lets do the needful and revert.

[Anonymous Coward]

There was only 45K H1-B visa anyway - this really isn't an issue in a country the size of the US when you consider the vast majority are things like a German bankers and every other country and Industry.

The US has been offshoring their whole manufacturing industry for decades - services has been on that route for at. Least 20 years.

Often the only reason a US worker gets a job is because there isn't an articulate, qualified alternative in a BRIC or MINT etc economy.

[jgarbo]

Or do it the way the Thais do for expats. The minimum salary must be higher than an equivalent Thai - and the expat must be taxed on that salary (even if he/she works for less) and the company must pay full payroll tax & insurance. Also, of course, the hiring company must disclose last five years of tax and prove that a Thai cannot do the work, and must employ seven Thais for each foreign worker . Working in Thailand is rather difficult for a foreigner.

[Anonymous Coward]

Tech Mahindra

Tech Mahindra, the company that helps Indians bypass the normal visa entry route to live in the UK by bringing them to the UK on the ruse they are working for Tech Mahindra.

The steps to by pass UK immigration rules:

1) Go work for Tech Mahindra in India

2) Let them transfer the employee to the UK working in Tech Mahindra on a UK based project, usually British Telecom.

3) Stay in the UK for Tech Mahindra for 2 years then quit. Seek employment for a British based company in Britain.

4) Be resident and working in the UK for 5 years, then apply for indefinite leave to remain.

5) Immigration office awards the indefinite leave to remain permission.

6) Bingo! Permanent UK resident.

Seen it done many times.

Oh and why are most of these Tech Mahindra people so friggin' useless?

[Anonymous Coward]

Indian Software 'Engineers'

Name me a a major COTS application which has been developed by India. There is a reason why.