It's an old story: Skilled IT workers in the United States are fired and replaced with low-paid overseas employees and holders of H-1B visas. That happened recently at Molina Healthcare, a company that has scored $9 billion of Medicare and Medicaid contracts in the last three years.
But the story of Molina is a bit different than the usual outsourcing horror stories we hear all too often. Workers at Molina are fighting back with a lawsuit alleging that the company and its employment contractor have discriminated again them because they are not from India and fired them after creating a hostile work environment by holding meetings in Hindi with no translators present, leaving English speakers bewildered and isolated. Also according to the complaint, they required U.S. workers to take work home on U.S. holidays but did not ask Indian workers to do the same on Indian holidays.
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The timing is interesting as well. It's fairly clear that IT hiring is reviving, and I've recently spoken with many companies that say quality workers are in high demand. But Molina fired highly qualified workers who were already on the payroll. It appears that some companies have decided to permanently lower costs by relying on outsourcing and bringing in foreign workers, a strategy that damages the U.S. economy at a time when overall unemployment is above 9 percent.
The suit was filed in a California Superior Court on behalf of 18 of the displaced workers, who also allege that the employment contractor, Cognizant, deliberately flouted visa regulations by importing workers to displace -- not supplement, as the H-1B visas are supposed to be used -- a domestic workforce.
The story gains even more credibility: The chief witness for the plaintiffs is the former head of Molina's HR department, who along with other senior HR types is joining the suit, according to Jim Otto, the attorney who represents the fired employees.
And much of the financial information cited in the lawsuit was supplied by Laura Onufrock, Molina's former IT department budget manager. Onufrock isn't a plaintiff. Asked why she was acting as a witness in this case, she said, "They've done a lot of damage to people, and I'm hoping I can help." Onufrock spoke with a reporter at our sister publication Computerworld, which carried an excellent story on earlier developments in the Molina case last August.
In come H-1B visa holders, out go experienced U.S. workers
Late in 2009, Cognizant told the U.S. Department of Labor that its application to bring 40 H-1B workers into the United States complied with regulation stating that the importation of these employees would not have an adverse impact on the existing workforce. The application was approved on Jan. 13, 2010. The next day, 40 of Molina's programmers, managers, and security analysts were fired, according to the lawsuit. The workers were told they were being let go as a cost-cutting measure.