Foreign IT companies in US are 'body shops': US senator

Without making any direct reference to Indian IT companies like Infosys as he had done previously, US senator Charles Schumer has now said that these firms are not "chop shop" but "body shops".

The Democrat senator from New York said the purpose of the visa-fee increase is not to target Indian companies.

"I do want to clarify a previous remark which mischaracterised these firms where I labelled them as 'chop shops'. That statement was incorrect, and I wish to acknowledge that. In the tech industry, these firms are known as 'body shops'. That is what I should have said, and that is what they are," Schumer said in his remarks on the Senate floor yesterday.

"While I wholly oppose the manner in which these firms are using H-1B to accomplish objectives that Congress never intended, it would be unfortunate if anyone concluded from my remarks that these firms are engaging in illegal behaviour," the Senator said in reference to his previous remarks that has agitated the Indian companies and Corporate America as well.

"I also want to make clear that the purpose of this fee is not to target businesses from any particular country. Many news articles have reported that the only companies affected by this fee are companies based in India and that ipso facto the purpose of this legislation is to target Indian IT companies," he said.

The senator said it is simply untrue that the purpose of this legislation is to target Indian companies.

"We are simply raising fees for businesses that use the H-1B visa to do things that are contrary to the programme's original intent, and that will be on any company from any country that does it," Schumer said.

He said that visa fees will only increase for companies with more than 50 workers and those who continue to employ more than 50% of their employees through the H-1B programme.

"That was never even close to anyone's thought when H-1B was passed," he said.

Congress does not want the H-1B programme to be a vehicle for creating multi-national agencies where workers do not know what projects they will be working on or what cities they will be working in when they enter the country, the Senator said, adding it is solely based upon the business model of the company, not the location of the company.

"If they are using the H-1B visa to innovate new products and technologies that is a good thing, regardless of whether the company was originally founded in India, Ireland, or Indiana," Schumer said.

"But if they are using the H-1B visa to run a glorified international agency for tech workers in contravention of the spirit of this programme, I and my colleagues believe they should have to pay a higher fee to ensure that American workers are not losing their jobs because of the unintended uses of the visa programme that were never contemplated when the program was created," he added.