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Indian IT firms are heading for a fall

Response to visa-related lawsuits indicates that Indian services firms don't fully understand the American system

April 6, 2012 06:11 AM ET

Computerworld - India's IT firms understand software, but not America.

It is the American character not to back down, and to fight for what is right. Our children are taught this from their earliest ages. Even new arrivals, immigrants or people on work visas are quick to grasp this essential truth.

America's institutions reflect the national character. Our political system encourages sharp and hard contests. Our legal system facilitates a fight, as India's IT companies are now learning.

Three of India's largest IT outsourcing firms, Infosys Technologies, Larsen & Toubro InfoTech and Tata Consultancy Services, are involved in lawsuits filed against them by current and former employees.

The lawsuits are a problem for each of the companies. But taken together, the cases are a major threat to the Indian IT industry in America.

India's IT firms are dependent on American businesses for about half of their revenue. They can't operate in this country without work visas, such as H-1B and L-1 visas.

Thus the allegations by employees of visa misuse and harassment have broad implications and are attracting federal investigators and congressional oversight.

Infosys Technologies

Infosys Technologies was sued early last year by employee, Jay Palmer, who contended he was harassed after refusing to participate in what he alleged was a scheme to use B-1 visas, a business visitor visa, for work requiring an H-1B visa.

The visa claims raised by Palmer attracted the attention of federal investigators, and led to a grand jury investigation, with subpoenas issued by the U.S. District Court for the Eastern District of Texas.

The grand jury report has not been released.

The lawsuit also attracted the attention of U.S. Sen. Chuck Grassley (R-Iowa), who is always on the hunt for new ammunition for his longstanding efforts to get restrictions on work visas.

Meanwhile, Palmer's civil case is continuing through a discovery process.

Larsen & Toubro InfoTech

IT services firm Larsen & Toubro faces discrimination claims in lawsuits filed by two former employees, each of whom claim that their pregnancies led to harassment on the job and loss of employment.

One of the people who joined in the class action lawsuit, Nanda Pai, worked in the human resources department.

Pai's lawsuit, filed this week, alleges that there was large scale visa fraud and a subsequent cover-up at the company. In the suit, she said a particular concern was the forging of her signature on visa-related documents. Pai was worried that she was being set up as a fall guy if something went wrong.

If the U.S. government is interested in Infosys, it's probably not a reach to expect that federal investigators will also take a look at the allegations against Larsen & Toubro.

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