Infosys settles with US government for $34 million over visa dispute

Infosys denies any claims of 'systemic' visa fraud

Indian outsourcer Infosys has agreed to pay US$34 million to the U.S. to resolve all allegations about the misuse of visas to get Indian staff to work in the U.S.

The company, however, denies and disputes "any claims of systemic visa fraud, misuse of visas for competitive advantage, or immigration abuse." This is reflected in the settlement, in which the U.S. government acknowledges that Infosys shows commitment to compliance with immigration laws, Infosys said Wednesday.

Its use of B-1 visas was for legitimate business purposes and not in any way designed to circumvent the requirements of the H-1B program, Infosys said in a filing to the Bombay Stock Exchange, reiterating a stand it has taken previously.

B-1 visas are intended for short-terms visits instead of longer duration H-1B temporary work visas, which are harder to get.

The settlement does not involve criminal charges or court rulings against the outsourcer, and does not place limitations on its eligibility for U.S. visas or federal government contracts, Infosys said.

The complaint and the settlement agreement filed in court under the False Claims Act by the U.S. Attorney for the Eastern District of Texas, Shamoil Shipchandler, could not be immediately accessed from the online records of the U.S. District Court for the Eastern District of Texas, Sherman Division.

The False Claims Act allows private parties to file actions alleging that defendants defrauded the federal government, with a part of the penalty money going to the private party in the case of a victory. Infosys came under scrutiny in the U.S. after Jack Palmer, an Infosys employee in the U.S., alleged that the company committed visa fraud and that he had faced mistreatment for questioning the practice.

Infosys had hinted that a settlement with the U.S. government may be coming soon, when it said earlier this month during its quarterly earnings call that it had made a provision of $35 million towards "visa related matters," including legal costs relating to a proposed resolution with U.S. agencies over their "investigation into the company's compliance with Form I-9 requirements and past use of B-1 visas."((

Form I-9s are used for verifying the identity and employment authorization of individuals hired for employment in the U.S. "There is no evidence that the I-9 paperwork violations allowed any Infosys employee to work beyond their visa authorization," Infosys said.

Infosys received in May 2011 a subpoena from a grand jury in the Texas court that required the company to provide certain documents and records related to its sponsorships and uses of B-1 business visas. The U.S. Department of Homeland Security found errors in a significant percentage of its Forms I-9 that it had reviewed, the company said earlier this month.

"Some companies are finding creative ways to subvert the H-1B visa program and bring in foreign workers to the detriment of American workers," U.S. Senator Chuck Grassley, a Republican senator from Iowa, said in a statement Tuesday in response to news reports of an impending settlement. Companies are circumventing the H-1B program by using the B-1 visa program, which does not have the same wage and recruitment restrictions of the H-1B program, he said.

The use of workers from India on outsourcing projects has traditionally been a contentious issue, particularly as Indian outsourcers are believed to replace U.S. workers.

Only 0.02 percent of the days that Infosys employees worked on U.S. projects in 2012 were performed by B-1 visa holders, Infosys said in its filing on Wednesday.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags outsourcinglegalservicesoffshoringinfosysU.S. Department of Justice

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

John Ribeiro

IDG News Service
Show Comments

Cool Tech

Toys for Boys

Family Friendly

Stocking Stuffer

SmartLens - Clip on Phone Camera Lens Set of 3

Learn more >

Logitech Ultimate Ears Wonderboom Bluetooth Speaker

Learn more >

Christmas Gift Guide

Click for more ›

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?