Grassley hits Microsoft on layoffs

Microsoft Corp. should lay off temporary foreign workers hired under the H-1B visa program before it gives pink slips to American employees, Sen. Charles Grassley (R-Iowa) has said.

Microsoft announced Jan. 22 that it would be laying off 5,000 employees, including 1,400 workers to be let go immediately. The number of H-1B visa holders among that group was not disclosed.

“The purpose of the H-1B program is to help companies hire foreign guest workers on a temporary basis when there is not a sufficient qualified American workforce to meet those needs,” Grassley said in a statement. “However, the program is not intended to replace qualified American workers.”

In recent years, Microsoft executives have actively lobbied for expansion of the H-1B visa program that covers highly-skilled foreign workers, along with executives from many information technology contractors such as Boeing Co. and Hewlett-Packard Co. The current cap on those visas is 65,000 annually.

In past years, IT industry executives have claimed that more H-1B visas stimulate the economy and improve competitiveness. However, some IT workers in the United States oppose H-1B visa expansion because they are worried about depressed wages.

For the last two years, the demand for H-1B visas has exceeded supply. With the economic downturn, Microsoft and other IT companies have had layoffs and it is not clear what the effect will be on H-1B demand. The application deadline for the visas is April 1.

Grassley has been a long-time critic of H-1B visa expansion and has brought attention to the program’s relatively high fraud rate. A study by the U.S. Citizenship and Immgration Services Agency estimated 20 percent violation rate in the H-1B visa program.

“It is imperative that in implementing its layoff plan, Microsoft ensures that American workers have priority in keeping their jobs over foreign workers on visa programs,” Grassley wrote Microsoft Chief Executive Officer Steve Ballmer on Jan. 22.