Two American senators have alleged that Indian IT companies are displacing American workers by hiring Indians at lower wages and are misusing the H1B visas. . . Indian companies have reacted to this saying these allegations are unfounded and that there has been no abuse of H-1B visas on their part.
In this CNN video, U.S. India Business Council (USIBC) president Ron Somers states that "certainly there has been no abuse" of H-1b visas by these member companies of the India Business Council. NASSCOM also denies that any abuse is occurring.
CALLING INDIA'S BLUFF
However, according to the Hindustan Times in September 2006, a top user of H-1b within the U.S. admitted to substantially underpaying their H-1b workers, citing that underpayment as their "competitive advantage":
Tata Consultancy Services (TCS) vice president Phiroz Vandrevala even admitted that his company enjoys a competitive advantage because of its extensive use of foreign workers in the United States on H-1B and L-1 visas. "Our wage per employee is 20-25 per cent less than US wages for a similar employee," Vandrevala said. "Typically, for a TCS employee with five years experience, the annual cost to the company is $60,000-70,000, while a local American employee might cost $80,000-100,000. "This (labour arbitrage) is a fact of doing work onsite. It's a fact that Indian IT companies have an advantage here and there's nothing wrong in that. The issue is that of getting workers in the US on wages far lower than the local wage rate."
According to this list compiled by InformationWeek, TCS is the 4th largest user of H-1b visas within the U.S. Most likely InfoSys, ranked number one, and Wipro, ranked number two, are also abusing the H-1b to execute similar "competitive advantage" against American workers.