A statement from the AG's office said that Infosys abused existing visa rules and failed to properly compensate hundreds of workers and pay applicable taxes.
“We will not permit companies to violate our laws in order to undercut New York workers. My office is committed to ensuring that our state’s labor marketplace is fair, competitive and transparent for all”, said Attorney General Schneiderman in a statement late Friday.
The statement further said that Infosys used temporary visas called B-1 visas, which are easier to obtain, instead of H-1B work visas which are used for transfer of skilled workers to send its employees to onshore locations in the state of New York.
"Because they apply only to visits, B-1 visa holders are not permitted to perform work of the kind Infosys workers were sent to New York to do, and they are not subject to the H1-B prevailing wage requirements", the statement added.
Infosys provides consulting and outsourcing services to many New York-based clients in the financial sector, among other industries.
The settlement resolves whistleblower claims that Infosys, in the course of providing outsourcing services, routinely brought foreign IT personnel into New York to perform work in violation of the terms of their visas, the AG's office said.
The misuse of H-1B visas has been a long drawn issue for the Indian IT industry in the US, which is its largest market.
The industry is grappling with impending changes to the H-1B visa allotment process, which could significantly impact the movement of skilled IT workers from India to the US.
This helps them keep costs low and gain an advantage over global competitors.
The settlement includes a recovery to the State for tax damages and other applicable damages and penalties.
The AG's office said Infosys was found to have provided instructions to employees on B-1 visas regarding how to deceive US Consular Officials and/or Customs and Border Protection Officers.
The statement further said Infosys submitted or caused to be submitted, “invitation letters” to US Consular Officials that concealed the true purpose of the Infosys employees’ visits to the United States.
Infosys was also found to have been paying lower wages than the applicable prevailing wage requirements to these workers, in addition to avoiding paying applicable payroll taxes on the wages of the Indian workers who were sent on B-1 visas to New York, instead of the prescribed H-1B visas.
The Bengaluru-based company said in a statement: "Infosys’ agreement concludes the State of New York’s investigation relating to the amount of taxes the Company paid in 2010–2011 without any criminal or civil charges being filed".
While this investigation centered on alleged paperwork errors, the company committed no wrongdoing and denies all allegations made in this regard, Infosys added.
This settlement, according to the company, relates to legal issues already resolved under the 2013 settlement with the US Department of Justice and was reached by both parties to avoid protracted litigation.
"Infosys maintains robust policies and procedures to ensure adherence to all applicable regulations and laws. Infosys will continue to focus on boosting American innovation, hiring American workers and better serving our valued customers across the United States", Infosys said.
News Source: money controlLast modified on Thursday, 09 November 2017