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February 1999, Volume 6, Number 2

Temporary Workers

Temporary Workers. More US employers are complaining of labor shortages, and asking for changes in the H-2B program, which permits the entry of unskilled foreigners to fill temporary US jobs. The Iowa Lodging Association is advocating a plan that would permit states to administer immigration programs. Marriott in Des Moines pays housekeepers an average of $7.76 an hour. Some Iowa employers are using the H-3 program to bring trainees into the US.

On January 5, 1999, DOL published proposed regulations to implement the American Competitiveness and Workforce Improvement Act of 1998 (ACWIA), which raised the number of H-1B visas available for foreign professionals and specialty workers to be employed in the US from 65,000 to 115,000 in FY99 and FY00, and to 107,500 FY01. As of December 31, 1999, 59,108 of the 115,000 H-1B visas available for FY99 were used. About 44 percent of the H-1Bs admitted are from India.

The H-1B program allows US employers to secure and employ professional nonimmigrants to fill specialized jobs in the United States. DOL estimates that 250,000 applications for H-1B workers will be filed by 50,000 US employers each year.

In exchange for raising the number of H-1B visas available by 142,500 over three years, the ACWIA: (1) requires all US employers to pay a $500 fee per H-1B application; and (2) imposes new duties on H-1B-dependent employers, generally those with 15 percent or more H-1B workers in their labor forces (H-1B workers with a masters degree or more or earning $60,000 or more are not included in calculating dependency). The intent of these changes was to generate funds for scholarships that would encourage Americans to become computer programmers, thus eliminating the need for H-1B foreigners in the future, and to more closely regulate staffing firms or "job shops," businesses that employ mostly H-1B computer programmers and send them out to US firms to complete temporary assignments.

US employers wishing to hire H-1B workers must file a labor condition application (Form ETA 9035) with DOL in which the employer promises to pay H-1B aliens prevailing wages, provide them with working conditions that do not adversely affect US workers similarly employed, and certify that there is no strike or lockout. The US employer must show that he actively recruited US workers, and failed to find enough; generally, DOL cannot investigate employers who do not abide by their promises or engage in good faith recruitment unless DOL receives a complaint.

If the employer is one of an estimated 100 to 200 H-1B dependent employers, or is a willful violator of H-1B regulations, the employer must certify that US workers were not laid off to make room for the H-1Bs. DOL regulations also seek to protect workers who are brought into the US as contingency employees, for example, brought from India by a firm that does not have an assignment to give them. If employees are "benched" awaiting a job, the employer must offer the employees prevailing wages and benefits, although it is unclear what the employer's obligation is if the employee "voluntarily" decides that he will take unpaid vacation during such work lulls.

The DOL regulations indicate a new trend in foreign workers: writing very detailed legislation covering one or a few industries, and then having at least three fights between advocates of more and fewer temporary foreign workers: once in the Congress over the law, again as the implementing agencies issue regulations to implement the law, and then a third time as advocates clash over enforcement of the law. The history of the H-2A program shows that funds spent on implementation, studies and enforcement can become a significant fraction of the wages earned by the foreign workers. If the trend toward "rifle" rather than "shotgun" guest worker programs continues, more seemingly esoteric controversies can be expected.

In 1992, the 5,000 contract workers at Microsoft filed suit over their status, claiming they should be treated as "common-law" employees entitled to benefits rather than as independent contractors; about 25 percent of Microsoft workers are paid as independent contractors. As their contracts expire, Microsoft is requiring these workers to sign new five-page contracts that they give up any money they might win from a pending class-action lawsuit if they want to continue working for Microsoft.

G-Visas. The headquarters of several major international organizations, including the United Nations, International Monetary Fund and World Bank are located in the United States, which issues G-visas to the representatives posted there. G-4 visas are issued to international organization officers and employees, and G-5 to their servants or personnel employees. In recent years, about 50,000 G-4 visas have been issued, and 1,500 G-5 visas. Foreigners also enter to work in embassies, and they too may bring domestic helpers. The State Department reported that 3,800 domestic servants enter the US each year to work for foreign diplomats and non-US staff members of international organizations. Although these servants may be from any country, about 25 percent are from the Philippines.

In order to obtain visas to enter the US, the domestic helpers must present contracts that satisfy US wage and hour laws at US consulates abroad. However, there is no monitoring of these contracts in the US. Several cases of abuse have surfaced, prompting Attorney General Janet Reno to decry "the serious problem of modern-day slavery" in the United States.

Marianas. In January 1999, apparel workers and human rights groups filed a class-action suit against 18 well-known American retailers and apparel companies, including Tommy Hilfiger, The Gap, Nordstrom, and J. Crew, charging that they conspired with factory owners in the Northern Marianas Islands, an American commonwealth near the Philippines, to deprive the 15,000 apparel workers there of basic rights. The suit charges that women from China, the Philippines, Bangladesh and Thailand pay recruiters $2,000 to $7,000 for "jobs in America," and seeks $1 billion in damages.

About $1 billion worth of apparel enters the US from the Marianas each year, saving manufactures and customers about $200 million in duties. The minimum wage in the Marianas is $3.05 an hour; the US minimum wage is $5.15.

On January 19, local Republican leaders on Saipan told a visiting team of Clinton administration officials that they would not voluntarily give up the islands' exemption from federal immigration, customs and labor laws. The Northern Marianas' commonwealth status allows U.S. apparel corporations doing business in the islands to label their products "Made in the USA." Clinton administration officials want the Northern Marianas to voluntarily give up their special status.

Foreign workers make up 91 percent of the private work force. Most hotel workers are Filipino; most garment workers are Chinese. US officials say that indigenous islanders live off sweatshop labor.

"Saipan lawsuit allege US firms are tied to 'sweatshops," Associated Press, January 14, 1998. Robert Collier, "Stalemate in talks on Saipan Workers," San Francisco Chronicle, January 20, 1999. Steven Greenhouse, "18 Major Retailers and Apparel Makers Are Accused of Using Sweatshops," New York Times, January 14, 1999. William Branigin, "Imported Servants Allege Abuse By Foreign Host Families in U.S.," Washington Post, January 5, 1999.