Visa Issues to the Fore

So, the Polaris, i-Flex and Malaysian incidents have shaken the Indian

software industry, you say? But they weren’t really connected. Or were they?

Or should they be?

Even as the three instances unfolded, and debate on whether the iFlexs and

Polaris’ of the software industry were really at fault raged across the

country and the world, almost every Indian IT company is sending off–even as

you read thispiece–employees to run its overseas operations. From the

Netherlands to Dubai and Malaysia to South Africa, Indian IT professionals are

plodding away, implementing software solutions, cutting code or training their

hosts on various technologies.

With over 20,000 consultants worldwide serving clients in 55 countries, Tata

Consultancy Services has its finger on the pulse of what’s rocking Indian IT.

"The backlash that we are witnessing has its roots in social problems being

faced by many countries, including the issue of unemployment," says a TCS

spokesperson. Given the sheer scale of Indian IT professionals who contribute to

global businesses, the TCS representative is confident that dependence on IT,

and the decision to outsource to Indian firms, continues to have a bright

future.

"In difficult times, the use of IT and outsourcing to Indian companies

has a compelling value proposition. In good times, the use of IT enables company

revenues to grow even more rapidly. And though there are instances of proposed

legislation, it is difficult to envisage support from the private sector in the

US, simply because it is a question of survival. They will continue to direct

business wherever it makes good business sense for them," the TCS

spokesperson sums up.

Irrespective of whether this is really a witchhunt against the Indian IT

exports success story, or whether the debate is just a mountain made out of the

molehill of three freak incidents, there’s no doubting that Indian companies

with overseas operations need to be extra careful. In this feature, Dataquest

tells you what could go wrong and how your company can stay out of trouble.

So what are the various legal problems that could arise when companies deploy

IT professionals on overseas assignments?

The most important–and probably the stickiest of them all–remains the

visa issue. Companies need to confirm whether employees need a work permit

(long-term visa) or a B1 (business visa for short-term visits) for the

particular project in question. The visa required is defined by the kind of work

being done by the employees (whether it involves writing software code or just

implementation of a software product). Apart from the type of work, it also

depends on which country the companies are operating in.

"Which visa to use depends on the nature of the assignment, and in our

case, has nothing to do with flexibility. The number of L1 visas (intra-company

transfers) used at any point varies–depending on the requirements as well.

Sometimes, the ratio of L1:H is 50:50; sometimes 60:40, and sometimes 70:30.

This depends on the requirements," says the TCS spokesperson.

While understanding the rules of exactly what is allowed under which visa is

crucial in ensuring that employees always maintain a valid immigration status,

the issue of wages could also lead to a snag if not handled carefully.

For instance, all individuals working for TCS, regardless of their

immigration classification, pay US taxes and receive the full benefit of US

labor and employment protection. They are all employed by TCS in the US and are

compensated at salary levels at or above the industry norms.

"Wages paid by companies should be in compliance with the prevailing

wages in that country at any point of time. These prevailing wages are regulated

by the Department of Labor of Federal Government," informs Vijay Bhagwati

of Birlasoft who is based in the US.

Bhagwati cautions that employees at client sites on business visas must work

on wages and just perform the knowledge transfer or system study.

"We should clearly know that all other benefits like medical, insurance

and retirement are part of compensation when an employee is working on a visa.

Failure in one or all of the above will be construed as a major legal

issue," warns K Sridhar, chief human resources officer, SSI Technologies.

IDC India country manager Kapil Dev Singh believes that a strong framework of

legal understanding and a crisis management policy, in case there is a problem,

is required.

There are cases in which the purpose of travel on a specific visa is not

communicated properly to the official of the visiting country at the port of

entry. This may result in difficulties on account of interpretation.

"There is a strong need for orientation and awareness of the legal

framework of different countries with respect to work permission and migration

laws. Industry bodies and the government need to take the initiative in doing

so. Specific steps can also be taken by companies to avoid any such

incidence," says Kapil Dev Singh of IDC.

Once companies have ensured that the correct visas are in operation, they

need to work towards finishing projects within the defined timeframe.

"Over-staying should be avoided at any cost. We should also ensure that

the extension of visas is not asked for unless it is extremely critical.

Wherever possible, we should provide opportunities for local employees to prove

that we are an equal opportunity employer," says Sridhar K of SSI.

At TCS, for instance, once a business opportunity is identified, the company

seeks legal advice on understanding the laws of the country, its immigration

policies etc. The credentials of the company in question are thoroughly checked.

"For this, we interact closely with local bodies, including getting

inputs from the government of India representative there. Also, once we start

working, we ensure that our people are involved in integrating themselves with

the local customs/social milieu," says the TCS spokesperson.

It is extremely important to induct employees into the customs, business

rules and etiquette of that country. Employees should also be given advice on

various terms and conditions, legal as well as general contacts in the local

geography, who could be reached in case of emergency. It is also crucial that

companies cover their employees with appropriate medical and travel insurance.

Once bitten…



After the incident involving the detention of its CEO Arun Jain in

Indonesia, Polaris Software has a set up a special division, the Audit and Risk

department that handles such contingencies to ensure business continuity. The

company’s employees are also given prior instructions on the local contacts in

the specific geography in case of an emergency. They are also given a guidebook

on travel.

"Companies need to plan for appropriate lead-times and type of visas and

contingency plans while committing to customers.

Of late governance is gaining momentum over business prudence," says S R

Ramaswami, vice president, Audit and Risk Department, Polaris Software Lab.

Ramaswami informs that practicing lawyers in the US for instance, receive

constant updates through a regular bulletin. "Reviewing these regularly

would enable companies to be well geared for any unforeseen event," he

says. This effectively means that if employees are on the right type of visas

and companies follow the law and pay all the applicable taxes, there should be

no room for trouble. Stressing on the need for compliance with the law, Laxman K

Badiga, chief executive, Talent Transformation and External Relations, Wipro

Technologies points out, "Indian IT companies should play by the rules of

the game, and not resort to false representation of facts to visa officials or

evade wage standards."

Besides, there could be an anomaly in the application of visa rules and

regulations.

"There have been several circumstances in which visa officers have not

been consistent in accepting or rejecting visas. Their interpretation varies and

many a times it boils down to their whims and fancies, " points out SSI’s

Sridhar.

Despite accounting for these aspects and due diligence in

implementing the laws of the land in question, there could still be cases of

trouble on the legal front. What is the course of action employees need to

follow? Questioning by authorities or worse, detention in an unfamiliar land,

where one has little or no social support, can be an unnerving experience. So,

who does one turn to?

The company’s own immigration attorney and legal counsel

from respective countries who would have in-depth understanding of the local

visa and the legal issues. Besides, it is here that softer issues like

integration in the social milieu and contacts with



local associate play a crucial role in developing a quasi support system.

After all, when in Rome, it is never too early to start

behaving like the Romans.

Manjiri Kalghatgi

Untangling the Visa & Work Permit Jargon

While ground-rules largely remain the same, implementation and interpretation

could vary in different countries...

There are two categories of visas Indian IT companies use while sending

employees overseas–short-term visas for business visits, requirement study,

product implementation support etc, which are not in the nature of employment

and secondly, employment visas for work permits. The US for instance, has a B1

visa for short-term business visits, H1B for technical work, L1-A for

transferring managers and L1-B for transferring specialized technical employees.

For other countries, it is either a business visa or work permit. As per

Immigration laws applicable in USA, H1B, L1A, L1B or B1 (Business Visa) are visa

classifications, while H1B, L1A and L1B are Work Permits.

H1B is a work permit granted by Immigration and Naturalization

Services (INS) of USA. H1B can be requested for maximum of three years after

which the H1 extension needs to be filed with INS before the expiry of the first

H1.

B1 (Business Visa): The B1 visa enables an individual to visit the US

on the request of a company in the US for a brief business trip. In certain

circumstances his stay may need to be extended due to urgent prolonged business

requirements. Such situations would require the company to file for extension of

B1 Visa before the expiry of current visa. Once the petition for B1 extension is

filed, it usually takes four to five months before it is approved during which

time the B1 visitor would have gone back to his country. If he wants to revisit

USA on any visa, he must carry the copy of such an approval.

L1 (Intra-company Transfers):  To qualify as an

intra-company transferee, the candidate must, within the three years preceding

the time of his or her application for admission into the US, have been employed

abroad continuously for six months by the company abroad, an Affiliate of

the Company in USA. This period was reduced to 6 months vide

the amending Section 214(c)(2)(A) of the Immigration and Nationality

Act (8 U.S.C. 1184(c)(2)(A). To enable an employer to take benefit of L1 Intra

Company Transferee process, an employer must have an approved Blanket Petition

from INS.