US visa probe puts Infy in spot of bother

Accusations that Infosys , repeatedly violated terms of business visitor visas were first raised in a lawsuit filed in February in Alabama by Jack Palmer, an Infosys project manager. Aside from Palmer, at least two other Infosys managers in the US have submitted internal whistle-blower reports pointing to Indians on business visitor visas who were performing longer-term work not authorised under those visas, according to internal documents and current Infosys managers.

Infosys has acknowledged that it had received a subpoena from a federal grand jury in Texas seeking information about the company’s use of the visitor documents, known as B-1 visas. N R Narayana Murthy, Infosys founder, expressed his concern about the investigation at in his final address before he retired as company chairman.  “As I leave the board, I feel sad” about the subpoena, he said. “The issue will be decided on its merits in due course,” said Murthy.

In papers filed in Palmer’s lawsuit, Infosys denied all his accusations and asked a federal judge to remove the dispute from court and send it to arbitration. Infosys said it was committed to “absolute compliance” with American visa requirements and had undertaken an internal review of its practices.

“Infosys is a large and rapidly growing company,” the statement said. “We have made changes over time to certain of our policies relating to the business visa program and we may continue to make improvements in those policies and controls.”

Broader attack

The Infosys inquiry coincides with a broader attack in Congress on longer-term visas, known as H-1B, that Infosys and other Indian companies rely on to bring Indian technology workers to the US.  In recent years, top companies receiving those visas were not American names, but Infosys and Wipro.

The criminal investigation is perhaps the most worrisome development for Infosys, which enjoys a reputation as one of India’s best-run and most respected companies. The events began with Palmer, 43, a project manager from Alabama who was hired in 2008. In a sworn affidavit, Palmer said his differences with Infosys management began after he was summoned to a meeting in Bangalore in March 2010. Top executives, he said, discussed ways to “creatively” get around H-1B visa limitations “to fulfill the high demand for its customers at lower cost.”

Palmer said his supervisors asked him to write letters inviting workers to come from India for sales and training meetings, letters he believed were false. “I refused to write the letters,” he said.

After word got out of his refusal, Palmer said, he was chastised by his managers and began to receive threats by e-mail and telephone. In October, Infosys has confirmed, Palmer filed a whistle-blower report about B-1 visa holders from India assigned to projects he or others managed. His report said the B-1 visa holders were doing the same tasks as workers on H-1B visas, including writing and testing software code. Palmer said he personally knew of at least 60 Indian workers doing contract work on B-1 visas. Palmer still works at Infosys.  Kenneth Mendelsohn, his lawyer in Montgomery, provided documents and e-mails that he said Palmer shared with investigators from the State Department Bureau of Diplomatic Security, Department of Homeland Security and Justice Department.

Email exchange

In one email, another Infosys manager confirmed to Palmer that three Indians on B-1 visas were “working on client sites” on a contract with Baker Hughes, an oil services company in Houston.

In an email exchange with Jeffrey Friedel, a top lawyer for Infosys, Palmer described the work assigned to one B-1 visa holder on a project for Heidrick & Struggles, an executive search company in Chicago. “His project task consists of reviewing designs and then to physically create and write test scripts,” Palmer wrote. “This process is repeated over many weeks.”

Referring to the same employee, another manager wrote that he was “working on a B-1 visa” and cautioned his colleagues not to include the man’s name in any contracts. “We can’t put name on B-1 people for contract,” the manager wrote.  At least one of Infosys’ major clients, Wal-Mart, has been contacted by investigators about its contracts with Infosys. There has been no suggestion of wrongdoing by any Infosys client mentioned in the visa investigations.

Palmer, filed his lawsuit claiming that Infosys had failed to protect him from threats from within company he received after submitting his whistle-blower report, and had unfairly withheld more than $100,000 in bonuses he was owed.

While denying Palmer’s claims, Infosys has noted that Indian employees with business visitor visas are a small part — less than 2 per cent — of its teams in the United States. The company reports a total of 15,500 employees in this country, including 10,100 on H-1B visas. North American clients account for 65 per cent of the company’s revenue.
At least one top Indian executive overseeing US immigration procedures has resigned from the company, Infosys said.