Cisco praised for not abusing H1B visas

By Julie Bort

As part of the ongoing debate about doubling fees for H1B visas, New York Senator Charles Schumer (D) has called out Cisco, among other U.S. IT firms, as examples of companies using the H1B visa correctly. But being praised by Schumer is a bit of a mixed blessing. He's had a rough time pulling his foot out of his mouth over his comments about Indian outsourcers while trying win support for his proposal.

Last week Schumer, chairman of the Senate Immigration Subcommittee, proposed a $600 million "emergency package" to improve security along the U.S.-Mexican border. He wants to pay for it by steeply raising fees for H1B and L visas for companies that use a lot of them. Fees are typically $2,000 to $2,500 each and the proposal would tack on about another $2,000 for companies with a U.S. workforce composed of 50% visa workers or those using more than 50 visas. Schumer says the fee hike is intended to target foreign outsourcers' U.S. operations. Schumer's office has gone so far as to name Wipro, Tata, Infosys and Satyam as the targets.

Schumer at first called Indian outsourcers "chop shops" ... oops. The comment caused an uproar among India's media. The senator this week "clarified" saying he meant to call them "body shops." I'm sure they like the new characterization much better.

As for Cisco, Schumer is quoted in his August 12, 2010, speech arguing for passage of the legislation as saying:

"Every day, companies like Oracle, Cisco, Apple and others use the H-1B visa program in the exact way I have just described—and their use of the program has greatly benefited this country."

But in that same speech he also said,

"Many of the companies that use this program today are using the program in the exact way Congress intended. That is, these companies (like Microsoft, IBM, and Intel) are hiring bright foreign students educated in our American universities to work in the U.S. for 6 or 7 years to invent new product lines and technologies so that Microsoft, IBM, and Intel can sell more products to the American public. Then—at the expiration of the H-1B visa period—these companies apply for these talented workers to earn green cards and stay with the company."

What? Since 2001, Microsoft has used more H1B visas than any other company -- Indian outsourcers included, according to statistics published on MyVisaJobs.com. Microsoft applied for 33,396 visas over the past ten years and more than 4,100 in 2009 alone (a year it had layoffs). IBM lands as the No. 3 user of visas both over the past 10 years and in 2009, with almost 1,700 applications (though not all applications are approved). Cisco is way down the list with a comparatively mere 394 applications, although it still ranks in the top 50. But, hey, so does Yale University with its 445 applications.

Schumer's press release innocently says that the 50% rule won't hurt U.S. tech companies -- and that's true. But the rule that hits those that hire more than 50 visa workers is another story, according to an editorial against the scheme from Boston.com.

That potential pain seems to already be having an effect. With half the year gone, Cisco (and Microsoft's) visa applications are sharply down. So far in 2010, MyVisaJobs has tallied only 11 applications -- and for Microsoft only 13. (I contacted Cisco to ask for verification of these stats, and is typical, haven't gotten a response. I'll update this post if I hear back.)

Over the years, Cisco's requests for H1B talent have fallen off altogether, the site says.

Cisco pays these workers pretty well. The average salary has been about $110K, with some positions paying about $60K. But this is in line with the salaries being spent by other networking companies on foreign workers. Juniper's pays, on average, almost $130K.

One final item to note: Cisco Systems has contributed $7500 to Senator Charles Schumer 2010 reelection campaign since 2009. It was part of $197,000 the company has spent on campaign contributions, says Congress.org.