Cognizant Technology Solutions, an IT consulting and business process outsourcing company, is being sued by American workers in a class action lawsuit that alleges they have a bias in “benching” Americans for South Asian H-1B replacements, primarily from India. Cognizant also recently reached a settlement with shareholders for $95 million in a lawsuit over bribes to Indian government officials. The Securities and Exchange Commission (SEC) and the Department of Justice (DOJ) were also involved in the bribery investigation, with Cognizant agreeing to pay a fine of $25 million. Two executives of Cognizant are still battling charges from the DOJ. The case recently faced a deadlocked jury with six jurors supporting a verdict for the workers and two jurors refusing.
So it is safe to say that Cognizant is hip-deep in legal troubles. While Cognizant settled with both shareholders and the SEC regarding their bribery and coverup, they have taken employees to trial to defend their bread and butter business model of depending on cheap labor from the H-1B program. According to the plaintiffs, at least 75 percent of the Cognizant employees are South Asian. They allege that Cognizant used fraudulent H-1B petitions to secure them and gave them preference in local hiring and promotions over Americans. When it came time to bench and fire, Americans were the first out the door. According to the Times of India, Cognizant is the largest sponsor of H-1B employees in the country.
One might hope that the Federal government would at least show some concern about the employees and their allegations in this trial. A class has been certified documenting abuse of a Federal program to the disadvantage of its citizens, after all. Not to mention the fact that the company in question has settled bribery lawsuits already and lead executives are under indictment. Well…in 2022 Cognizant had a 99 percent approval rate for H-1B petitions. In 2021, their H1B approval rate was 97 percent. Since 2012, they have only had two years below 90 percent approval. The Department of Labor is helping them out even more with labor certifications coming in at 99 or 100 percent approval every year. That means if the employees are telling the truth about their claims, the Federal government has been rubber-stamping H-1B approvals that are weaponized against the citizens it is supposed to protect. So much for all the labor protections in place that supposedly protect American workers.
Cognizant contracts with companies to fill needs, and when the contract ends, employees either move to another contract or to the bench. If you are on the bench for more than five weeks, you are terminated. An economist who testified at the trial, Phillip Johnson, stated that his analysis of Cognizant employment data suggested the disparity in American bench firings compared to South Asian employees indicated that there was “less than one in a billion” probability that the firing disparity was by chance. In other words, his expert testimony was that the firings of Americans were intentional.
This is all happening while we are under a supposed “labor shortage”, mind you. The tech sector is one of the loudest voices crying for expanding immigration because of their “inability” to find Americans willing and able to work. They are making these claims as multiple tech recruiting companies have settled discrimination claims where they blocked Americans from even applying. Also, the tech sector happens to be laying off workers by the thousands.
Another thing to keep in mind is that this is a class action lawsuit. The reason this is significant is that a putative class action requires a judge to certify a class exists before a trial can commence. Class certification is fiercely fought by defendants and can veer into a challenge on the merits of the plaintiffs claim. Often, if a class certification is granted, defendants seek to settle because the writing is on the wall. Cognizant certainly battled against class certification in this case based on a review of the filings in the case. And this is not an instance of a “Trump” judge tipping the scales. The class was certified by Judge Dolly Gee (of Flores fame). While plaintiffs can win at class certification stage and still lose at trial, many of the issues present at trial have already been litigated to some extent at the certification level. Here, the plaintiffs have the upper hand.
And Godspeed to these workers fighting against a rigged labor market. Their success would be a victory for every worker in the country. With a deadlocked jury, there will be a new trial or potentially a settlement. Our current hope is that employers begin paying a substantial price for exploitation and discrimination, because we are not seeing the other branches of government fighting for workers. The President is illegally issuing work permits to anyone who can afford to pay cartels to traffic them to the United States. Congress keeps focusing on how to exacerbate exploitation by expanding temporary work programs. If the courts prove equally unwilling to hear the grievances of workers, then they are left paying taxes to fund a government actively working against their interests.
JARED CULVER is a Legal Analyst for NumbersUSA
Updated: Tue, Jul 18th 2023 @ 3:30am EDT