[OPE-L:8632] Labor tensions in Silicon Valley

From: Rakesh Bhandari (rakeshb@stanford.edu)
Date: Tue Mar 18 2003 - 16:12:30 EST

It seems that though the wage labor form of exploitation may be free 
of immediate extra-economic coercion, state regulation of labor power 
(e.g., through the American H1B Visa programme) is quite important in 
capital securing wage labor on favorable conditions. A friend of mine 
Grace Chang (Evergreen College, UC Santa Barbara Women's Studies) is 
preparing a study on how Visa law is being used to supply the 
Canadian hospital system with cheap and vulnerable nurses, often 
extremely overqualified for the tasks which they are paid little to 
perform.  I haven't yet read Geoffrey Kay and James Mott's book 
Political order and the law of labour (1982), which I imagine is a 
work at different level of abstraction than Grace's.  I think Michael 
Williams included an article by Kay in a book he edited.
At any rate, the role of the state in the labour market is not 
something we have discussed in much detail.

Sun hit with discrimination suit
Indian workers favored, U.S.-born engineer alleges

Hiawatha Bray, Boston Globe Tuesday, March 18, 2003

A lawsuit filed Monday alleges Santa Clara computer giant Sun 
Microsystems Inc. laid off thousands of U.S. high-tech workers in 
order to replace them with younger, lower-paid engineers from India.

The lawsuit, for which class-action status is being sought, is 
certain to intensify an already fierce debate between technology 
companies and American engineers over the future of the H-1B visa 
program. Such visas let companies temporarily bring foreign workers 
into the United States.

Companies say that H-1B visas provide well-trained workers who have 
skills that are hard to find in the domestic labor force. But U.S. 
workers say that at a time of high unemployment among American 
engineers and computer programmers, the H-1B program is mainly being 
used to bring in cheaper workers from overseas.

The latest case, filed in Santa Clara County Superior Court, was 
brought by Walter Kruz, 52, who was employed at Sun from May 2000 
until late 2001, when Sun was laying off about 2,500 of its workers 
in the United States. While Kruz is currently the only plaintiff, his 
attorney, James Caputo, plans to sue on behalf of hundreds of other 
Sun workers whom he believes received similar treatment.

The lawsuit claims Sun had a bias in favor of hiring people from 
India, citing as evidence statements made this year by Sun's 
Indian-born co-founder, Vinod Khosla, on the CBS television program 
"60 Minutes." Khosla was quoted as saying that at Sun, people from 
India "are favored over almost anybody else."

According to the lawsuit, hardly any of those laid off by Sun were of 
Indian descent. Instead, the company created a performance evaluation 
program that required managers to classify a certain percentage of 
workers as underperformers, the suit alleges. At the same time, 
workers who had been at the company for a short time were exempted 
from this evaluation program, ensuring that few H-1B visa holders 
would be subject to it. As a result, most of those found to be 
underperfomers were older, American-born workers.

At the same time, the suit alleges, Sun was applying for permission 
to bring in about 2,400 foreign workers, mostly from India, to fill 
technical jobs. Many of these jobs were advertised in the United 
States, as federal law requires. But the suit alleges that Sun 
refused to consider any of the laid- off U.S. workers for the 

By law, H-1B workers are supposed to receive the same pay U.S. 
workers would get for the same jobs. But Kruz's attorney, Caputo, 
said this requirement can be easily evaded. "By and large, these new 
workers are younger and less expensive," he said, "and additionally 
tend to be a little more compliant, because of their awareness of 
their circumstances. . . . They don't have the kinds of protections 
that most citizens have."

Kruz claims discrimination based on race, national origin and age. He 
seeks compensation for lost wages, attorneys' fees and unspecified 
punitive damages.

A Sun spokeswoman said the company's attorneys had not had a chance 
to review the complaint. But she noted the company had successfully 
defended itself against similar charges.

The most recent such case involved a former systems administrator, 
Guy Santiglia, who filed similar discrimination claims with the U.S. 
Equal Employment Opportunity Commission and with the departments of 
Labor and Justice. All three agencies dismissed the claims, ruling 
that Sun's use of the H-1B program was appropriate.

Sun also will be defending itself against discrimination charges in 
federal court. In January, Caputo sued in U.S. District Court in 
Colorado on behalf of 43-year-old Gail Matthews and other Sun workers 
allegedly displaced by H-1B visa holders.

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