Microsoft Corp. will lay off H-1B workers as part of its recently announced plan to let go of 5,000 employees over 18 months, but it will continue to hire foreign workers as well, even though Sen. Charles Grassley (R-Iowa) insists that the software maker has an "imperative" to ensure that American workers "have priority in keeping their jobs over foreign workers on visa programs."
If there is any imperative for Microsoft, suggested the company's general counsel, Brad Smith, in a written response to Grassley on Monday, it is that the company will hire and fire in its own best interest. Smith didn't use those exact words, but there is no mistaking the meaning of his letter.
Citing the large enrollments of foreign students in graduate and doctoral programs and its need to hire these graduates, Smith told Grassley that "we do not expect to see a significant change in the proportion of H-1B employees in our workforce following the job reductions."
Microsoft also pointed out that its planned job cuts are not as bad as they seem. Microsoft, which is based in Redmond, Wash., laid off 1,400 employees in January, more than 800 of whom are in Washington state.
But during the same 18-month period in which it will cut 5,000 jobs, Microsoft said it plans to hire 2,000 to 3,000 people, meaning the potential net payroll reduction may be no more than 2,000 jobs. The company did not say what percentage of those new hires will be in the U.S. It employs about 90,000 people worldwide, and about half of those workers are in the U.S.
With regard to how many H-1B holders will be cut, Smith wrote that "it's too early to know the precise answers."
Grassley, the Senate's leading critic of the H-1B visa program, could have sent his Microsoft letter to any number of high-tech companies that employ visa holders and have announced layoffs in recent months. But he took deliberate aim at Microsoft because of Bill Gates, the company's chairman, and his repeated defense of the visa program in Washington.
Among U.S. companies, Microsoft is a leading recipient of H-1B visas from the U.S. Citizenship and Immigration Service. Smith's letter makes clear that its ability to hire H-1B workers remains as important as ever.
"Although they are a small percentage of our workforce, H-1B workers have long made crucial contributions to Microsoft's innovation successes and to our ability to help create jobs in this country. We are confident this will continue to be true in the future," Smith wrote.
Grassley is seeking tighter controls on H-1B use. He recently succeeded, along with Sen. Bernie Sanders (I-Vt.) in restricting the use of H-1B visas by financial services firms that receive federal bailout funds.