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Marco Werman: You don’t see them a lot when you go to Disney World in Orlando, but every now and then there are some sad faces in the Magic Kingdom, like last year back in October--a lot of them, in fact. In this case, Disney employees themselves. Two-hundred and fifty of them got laid off. Then they found out that a group of workers from India would be taking over their jobs. And before clearing out their desks, the ones who lost their jobs had to train the new team. According to the New York TImes, Disney used an outsourcing company in India to hire the new workers and it managed to get them here through a type of visa known as H1B. Ron Hira joins me from Washington to explain. He teaches at Howard University and has done research on immigrant workers in the US. How did Disney actually go about getting these workers from India over here?
Ron Hira: Yeah, so Disney didn’t directly employ the H1B workers. What they did was they hired what’s called an outsourcing company, so a company that would bring in the workers on their behalf, and they signed a contract with a company called HCL, which is a major India-based outsourcing firm.
Werman: What kind of work are these people doing for Disney, both the ones who lost their jobs and the ones replacing them?
Hira: So, many of the American workers, they’re working in the information technology section of Disney, so it’s sort of behind the scenes, not the people who are meeting and greeting the customers but who are making sure that the cash registers are running, that the ticket sales are working; all of the IT, the software and computing behind how the park’s run, that’s what these workers were doing. They’re well-trained and they have often been at Disney for 10, 15, 25 years; very loyal employees. And the folks that they’re bringing in are from India. Typically they have a Bachelor’s degree--no more than a Bachelor’s degree. They’re young and have very little experience.
Werman: So, what’s does federal law say about companies like Disney applying for H1B visas? Can they just hire anybody, regardless of nationality?
Hira: So, in order for a company like Disney or even for HCL to hire an H1B worker, what they do is they apply to the federal government for permission to do that, and they have to attest to certain things, that they pay a certain wage level and a few other attestations on there. But it’s fairly easy to do. Now, the law also says that bringing in an H1B worker should not adversely impact the wages and working conditions of US workers, but that condition is never enforced and it’s pretty much ignored by essentially every company.
Werman: Right. Do you know what the difference in salaries and wages is between the workers at Disney who got laid off and the new ones who came over from India on H1B visas?
Hira: Yeah, I spoke to a number of the Disney workers and they were typically being paid about $100,000 with pretty good benefits in addition. So, about $100,000 in wages. The HCL workers, HCL typically pays $61,000. So, you’re looking at a good $40,000 or 40% wage difference, plus additional benefits differences. So, very significant; this is a very profitable business model of bringing in these guest workers.
Werman: Okay, so what federal protections are there for workers who might get affected by a situation like this?
Hira: Well, there’s almost no recourse for the American workers--at least, it appears that there’s no recourse since the Obama Administration has refused to look into this, investigate the issue on behalf of the American workers, even though the Senate has a number of senators that have asked for an investigation, both the Southern California Edison case, which happened a few months ago, as well as the Disney case. In the case of the foreign workers themselves, they can complain, but at least we don’t have any indications that there’s been a direct violation of the law--of the letter of the law. There seems to be a violation of the spirit of the law.
Werman: So, is Disney alone in this? I mean, are there other companies of its scale that are taking advantage of the H1B visa and saving some money?
Hira: This is a widespread phenomena. It’s the who’s who of the Fortune 500, maybe even the Fortune 1000. There have been reported cases in Southern California Edison--well reported there; Cargill, Best Buy, Visier, and I could go on; Harley Davidson--as American they get. As well as in the financial services sector: all of the big banks are using these outsourcing companies and, in essence, bringing in H1Bs to replace their Americans.
Werman: So, those 250 people who were laid off at Disney, have you heard how they’re feeling about all of this?
Hira: Oh, I’ve talked to a number of them, both at Disney as well as a number of other companies. They are just dumbfounded that the American government allows this to happen. They’re devastated. Imagine that: being forced to train your replacement. It’s not that your job is being shipped off shore--your job stays here, it’s just that somebody’s replacing you, they’re bring in a guest worker to replace you.
Werman: Ron Hira teaches at Howard University and studies visa programs.