This Firm Tried to Pay Tech Workers $1.21 an Hour

shutterstock Dohee Han

What’s the minimum that some companies are trying to pay workers in Silicon Valley?

If you guessed “the required minimum wage for the state of California,” you’d be wrong: Electronics for Imaging Inc. paid eight Indian technicians $1.21 per hour, for as many as 122 working hours per week, with no overtime. The company claimed that the low salary was “unintentional,” and that it originally paid the IT workers what they earned as their regular salary in Bangalore.

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The technicians reportedly helped Electronics for Imaging transfer its technology stack from the company’s old headquarters in Foster City, California to its new one in nearby Fremont. An anonymous tip alerted authorities to the situation, according to the San Jose Mercury News. The company claims that it moved to rectify the situation as soon as an angry U.S. Department of Labor showed up on its doorstep.

The Associated Press quoted Michael Eastwood, a Department of Labor assistant district director, as saying that the situation was “worse than anything that I ever saw in any of those Los Angeles sweatshops.”

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Electronics for Imaging will need to pay more than $43,000 in penalties and back wages, which shouldn’t be much of a problem, considering the company expects to pull in just under $800 million in revenue for its fiscal year 2014.

Meanwhile, most tech workers in the U.S. continue to receive healthy salaries.

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Image: Dohee Han/Shutterstock.com

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51 Responses to “This Firm Tried to Pay Tech Workers $1.21 an Hour”

  1. COMPUTER SCIENCE GRAD

    I know this is sad, but I was on the floor laughing my butt off. And the arrogant audacity of the “…it originally paid the IT workers what they earned as their regular salary in Bangalore” excuse was an overkill of stupidity. Even in Bangalore tech workers make more than $1.21 per hour. Welcome to the new America: the greedy get richer, deny educated Americans a job in their field, and pay foreigners slave wages. Got a love it.

    • I am sure these H1B/L1B’s are aware of this too….They just want to get in USA and look for other jobs (the ones that Americans apply for) after getting here, try for lower wages…..that’s why it takes longer for the hiring process..

      • Fred Bosick

        The key advantage of those visas, for employers, is that you can’t up and quit a job and take another. The sponsor must agree to transfer the visa. Those guys might as well be dragging chains.

    • FedUpWithNobels

      If you think this is the only company that has ever done this, then you haven’t been following the stories over the last few years where outsourcers have been pulling this with all of their indentured servants.

      • COMPUTER SCIENCE GRAD

        No, FedUpWithNobels, I do not think this is the only company that has ever done this. I know this is not the only company that has ever done this, and companies have been doing this for many years for multiple occupations. The tech field is not the only occupation that has a problem with paying their employees a decent living wage. The tech field is one of the most recent occupations that are doing this. And although I am aware of many slave wage salaries for tech positions for Americans and foreigners, this is the lowest slave wage salary I am aware of. 8 workers at $1.21/hr averages out to about 15 hours per day 5 days a week per worker. The workers would have come out better if the company could have just kept the worker’s home refrigerator and freezer stocked.

    • it’ll be over soon enough – when people can’t buy what they’re selling no matter how cheap the labor. then the jokes on that business for wiping itself out due to its greed. better head to china company where you might last longer.

      • COMPUTER SCIENCE GRAD

        Robert, you are saying what I have been saying for years. People need to stop buying crap they don’t need. If we stop buying it, they will stop making it. Too many mindless people don’t get that. I also used to jokingly tell people I’m going to learn Mandarin Chinese, but I’m starting to think about it more seriously now.

  2. I hope the Federal government fined them heavily for not paying those workers at least minimum wage, it doesn’t matter what the cheapskate company intended, ignorance of the law is no excuse for breaking it, that’s what the Judge’s tell me every time I go to traffic court, I hope that this no name company was required to pay penalties and back pay to those workers ( It was probably Cisco Systems ). The Law should read that off shore workers, working in the United States are required to be paid the same as their U.S counterparts, in other words a prevailing wage in the Tech Industry and other industries is a must for U.S. workers to remain competitive. Whats next, bring in Eastern Indian Electricians and HVAC technicians in to the U.S.A to work for 1.25 an hour? I hope that President Obama and his administration has the [expletive] to do some thing about this and not let it go and makes an example out of them, like they did with my Wells Fargo foreclosure on my home that I owned for 15 years in San Jose.

    Jose F. Medeiros
    One [expletive]-off unemployed and homeless IT worker, and American

    • I know, it is total insanity. What they mean is “we cannot find anybody for less that $10.00/hour”. So they save a few bucks to hire less-than-qualified software developers, and wind up with software that is horribly designed, buggy, and hard to maintain. And if English is not their native language, it can make things much much worse when the software is complex. Just a small misunderstanding or two can waste months of time.

  3. Thanks to U.S. politicians being on the take from big business. CEOs who although are already making obscene bonuses want to make even MORE obscene bonuses, it’s a race to the bottom!

    https://www.youtube.com/watch?v=TCbFEgFajGU

    P.S. Love the way the defenders believe that inserting the suffix “ism” at the end of a word like “protection” will somehow give it a dark and foreboding tone Hahahha!!!!!

  4. Eric Price

    The media (dice too) is complicit in situations like this.
    They are all quick to report that there is an acute shortage of “qualified” tech workers.
    This is just code for: “there is a shortage of people who are willing to work long hours for low wages”.
    That is where the real shortage lies.
    The captain’s of industry are reluctant to pay what you are worth,
    so they can line their own greedy pockets.
    It’s a great system, if you’re on top.

  5. Fred Bosick

    There is no better illustration of what Corporate America thinks of its IT staff. And no better rebuttal to the claim that indentured IT servants earn the “prevailing wage”, unless it’s defined as whatever corporations can get away with. This has been picked up in other news sources, including the interesting fact that the HR manager has 30 years of experience, especially in compensation!

    This was completely deliberate, planned, and carried out by the executive ranks. What baffles me is how much did they actually expect to save, relative to the probability of getting caught and bad publicity? And can you expect underpaid and overworked people who just climbed out of an international flight, stuffed into some motel so as not to see the denominations carried by *bums on the street*, and shuttled to the workplace, to do a bangup job? It’s as if someone made it a game to see how low they can go.

    Revenue? $800million last year!

    I’m rather surprised DICE picked it up, with their endless bloviating about shiny, happy, IT people living it up. BTW, the very last sentence in the article really doesn’t get it. You can boast of large percentage increases over the past couple years, but flat salaries over the past 15-20 takes the wind right out of those sails.

  6. Who cares about the indians – they emigrate here and work for nothing and take away and take over jobs and companies and fire americans (whites, blacks, and hispanics). prevent indians from coming here in such numbers and stop doing so much business there. Open it up to all the other countries and peoples of the world.

    • Reality check

      Who cares about the Indians?
      The companies that spend thousands of dollars to get them here! so they can work in skilled jobs, that obviously can’t be filled by native Americans (Whites, Blacks, and Hispanics) I guess.
      Do you know what it takes to sponsor a H1b applicant on order to employ them in the USA by a company?
      Do you know how much it costs the individual and the company?
      If the answers are NO then I suggest you “Google it”
      If the answer is YES then, Are you one of those that thought you were skilled enough only to find you have been replaced by an Indian?
      We bring in talent from all over the world, if the talent fails, the company fail’s, so in essence the talent has to succeed. Think about it! or don’t doesn’t really matter to me, but if you do you might understand why talent is being sought overseas and not here.

      Think about it ! or dont dosent really matter to me, we bring in talent from all over the world, if the talent fails, the company fails’s, so in essence the tallent has to succed

      • You are most likely a fool HR or an Indian who is profiting from current disaster created for American IT workers. The issue is not only just cheap labor coming in in bus loads. These cheap labors soon find positions through their tribal contacts and replaced the remaining American IT workers. Have you looked at the demography of laid off people? Are you blind to see that the take over has gone from Engineering to Marketing and now HR. Most recruiters in big companies have now become Indian who work with Indian Managers and hire only Indians.
        Companies bring talent from all over the world at expense of higher paid experienced workers who are led go.

  7. Brian Dear

    And Democrats want to increase foreign workers and provide amnesty for illegals. When you increase the supply of something you lower its value. Note Zuckerburg and Gates are huge in this area. In fact, fwd.us just interviewed my company to gather more data about how ‘immigration reform’ would lower our employee costs. And that organization is notably supporters of Democrats. Remember that when you vote. Republicans, specifically Rand Paul oppose this sort of nonsense. But strangely, a large proportion of developers tend to lean Democrat. Be careful what you wish for. Democrats do not care about you. They care about promoting an underclass because that is their power base. Don’t blame “politicians,” let’s blame the Democrat politicians that want higher taxes, lower wages. Remember, the lower your wages the more likely you’ll need “help” and you’ll vote for those that will “help.” Notice the Dems promote minimum wage, but they resent when a tech worker gets 100k per year. They’d be happy with a higher minimum wage, but not so high that it gets people out of the lower classes. Think critically about this, Dems hate the ‘rich’ and ‘rich’ is anyone that makes more than the Democrats think they should earn.

    • Please, knock off the Democrat/Republican nonsense. Prove your comment with facts, if you can find any. Please stop drinking the Faux News kool-aid. How can you say that Democrats hate the rich when so many of them in Congress ARE rich? But, since you went there, the Republicans would have all of us Americans earning $1.21/hour with no benefits. They are the ones in bed with business. Please tell me what tech workers are getting 100K? I am making the same damn salary that I made in 2000 and I have top-notch .net skills. But, it is difficult to compete with foreign workers who are willing to work for less.

      • You really should look at a new company/position, JR. If you’ve been around 15-20 years in .NET and aren’t making 100k or more, you need to make a move. I’m making well over that in .NET and I’m in the Midwest, not on the East Coast or Silicon Valley where the cost of living is insane.

        Brian does have a point though. I’m tired of people complaining about CEOs, who have an entire company’s future on their backs, making big bonuses but are perfectly fine with celebrities and athletes who make obscene amounts of money.

        • TheTruth

          Jay loves his massa. He likes his crumbs from the table and if you dare to say that maybe, just maybe, the people who manage work and own your labor (to the point that they can even claim your ideas and techniques as IP and thus not transfer your skills to another job) are not the Gods/Captains of Industry/Job Creators that the sycophantic, capitalist, media says they are then by golly he’ll carry water for them like the good, mindless, pathetic, spineless, shill that he is. Until IT workers realize that their bosses don’t care about them, this crap will keep on happening. The problem isn’t immigration. Why can CEOs shift their money and companies overseas, but workers have to jump through numerous hoops just to step on stolen land? Don’t let the reactionaries fool you: so long as capitalism exists there is no real freedom unless if you own money and property.

          • Seriously, THETRUTH? More like THEBS. So we should all become socialists? How has that worked for Europe? Asia?? Don’t be so myopic. It is the unscrupulous practices of politicians who are pandering to illegals for their votes by allowing them to swarm into the U.S., without any effort to control immigration, which leads to this problem. Then they turn their backs when equally unscrupulous employers illegally employ those lower wage laborers, or in the case of skilled workers, they open up H1B/L1B visas to allow them to get in legally, and then we sit back and watch them transfer from the sweat shops they started at, to go to the somewhat better conditions someplace at $25/hr, which forces down salaries of all workers. If you haven’t noticed, there has been a significant effort to bring the living wages of Americans down to that level, while fools, like you, tell us how socialism would improve the situation. Maybe you show go live in Venezuela, which we seem to be following, step-for-step. Think about why people are LEAVING those socialistic countries that have tried your failed economic experiments, and tell me again how capitalism is the problem. Theory departs from reality in practice every time. How much more evidence do you need?

      • It’s terrible but refreshing to see that the white collar world is suffering from the same problems my blue collar one has been enduring for decades. A question posed to me years ago: “If foreigners want to come into this country and take the jobs no one else wants, why stop them?” That’s also been the excuse for paying construction/maintenance/facilities workers so little.

        Maybe now that the upper middle class jobs are being affected, someone with the ability to do something about it will. Let me know how that pans out- and when you unionize to protect your way of living. That’s what we had to do, and we still have to fight the mentality that unions are awful and destroy business.

        • RK, you probably could use some education in economics, too. What makes you think unions are the solution to this problem? Inflate the wages of your employers and control the numbers of workers. Hmmm, sounds like big government. Don’t we already have enough of a problem with unemployment, or are you suggesting that, because you already have your higher wage-protected job, you won’t have to worry about the others who don’t? So what happens to your plan when the people on whose backs your unemployed are being carried, no longer have living wages (or jobs)? Eventually, you will have to carry a bigger burden for the presently unemployed, and the future unemployed middle-class workers who have been carrying the burden with you. Isn’t it obvious that your plan of lowering the bar will eventually go bust? Again, welcome to Venezuela, stupid.

      • You NAILED IT!! All this outsourcing started in 2003 when Republicans crushed the dotcom’s systematically and started outsourcing….I guess its still being followed as these big companies must have paid a huge sum to Dems….Ultimately its the American People who bear the brunt……

        • I think the shift happened not long after 9/11(2001) when America had several terror attacks, and many businesses shut their doors because of the side-effects. In my opinion, this is around the time when recruiters and HR people got into the habit of trying to save a few dollars by not verifying backgrounds of applicants (professional and educational).

          Nowadays in IT, you can have a totally fabricated resume, and your chances of getting caught are slim. I do a lot of contract work, and for the 5 jobs I’ve had in the last 10 years, I’ve not had my references verified once, and I’ve not had my degree verified once.

          No surprise… Forrester Research recently published a report showing that more than half of people on LinkedIn decided to lie about their education and background, and never get caught. I’ve had too many of them as co-workers… somehow they passed a tech interview, but it wasn’t long before realizing they didn’t know a bit from a byte! Yeah, right, that CS degree from MIT you say you have? I guess MIT stopped teaching the minor basics like bits and bytes.

      • This is a big business issue and not so easily defined as a political party issue.
        Big business hired the lobbyists who got the tax laws tailored to favorably treat
        outsourcing. Maybe there were more Republican than Democrat CEOs and boards involved but it took bipartisan support in Congress and the White House for this mess to take shape and it will take bipartisan action to get it reversed. Don’t hold your breath though. We have the best government that money can buy and let the devil take the hindmost (you and I).

  8. Vishnu Mahant

    I wouldn’t have believed this if I didn’t know a fellow engineer who joined us at Intel and told us about his previous job in New York working on Samsung project for 18 hours a day. He was hired from Andhra Pradesh by a contractor working for two dollars an hour. Amazingly, he worked for little more than a years before he was hired by Intel! All this time we assumed it was illegal pay an engineer the salary lower than a farm worker.

  9. I am making a narrative film based on my own life experience under the H1B program. Here’s the link of my campaign at Indiegogo:

    https://www.indiegogo.com/projects/working-title-an-alien-of-immigrant-intent/x/8812008

    Kindly share with your friends at all your social media outlets, at your blogs, contribute if you would like. I think is important we help raise awareness, help people get informed, to prevent this.

    Regards,
    Nefeli

  10. Indian workers will do anything to stay in the US. They are well known to be cheap workers world wide. I would have taken advantage of them. Poor fellas. They work so much that they don’t have time to shower and thus have terrible body odor. Us workers in the US have made them a laughing stock.

  11. Ever had lunch at Oracle HQ, you can hear almost any language spoken. I used to be disappointed about so many Indians in IT. Then I realized they were only taking advantage of the immigration and tax laws passed by congress, thanks to Larry. Besides they are some of the most knowledgeable and nicest people I have worked with. And it is not just Oracle, after my company was bought by IBM in 2007 we were told in Jan no one was going to be layed off. By April there were 12 of us out of 60 to be layed off. I had the pleasure of training my replacement from Rome Italy where it is difficult to get rid of people and IBM had some idle IT guys there.

  12. While we are bashing Indians there is this other thing that is going on with head hunters, brothers, sisters, wives and cousins that have minimal IT skills, if not off shore are here working too.

    • And nobody knows how to test them before hiring them, so they’ll easily hire someone with minimal IT skills. And you have companies inventing new ways to test candidates, and very few of the ways are any good.

      There used to be a requirement for a lot of software development jobs: a college degree in computer science. Although many job ads still say they require the college degree, only about 1% of employers bother to verify it. Instead, the HR person just looks at an applicant’s LinkedIn profile, sees an education, and assumes it’s true. Recruiters are even worse… they don’t only skip the education check, but they skip doing background checks.

      Not that a degree is everything, but somebody who lies about having one probably has other moral problems that will show up soon enough. A college degree represents about 5 years of constant testing and scrutiny from good professors. Kinda funny how so many companies ignore that and feel like they must invent their own testing methods. It’s all laziness.

  13. I dont know if those Indian workers work 122 hours. Do the companies actually keep track of hours. Many greedy boss either make everyone salay or tell people to clock out after 8 hours. For salaried technician, in this case, your hourly pay is 1.21 an hour, and we will only pay you 40 hours a week, but you must work more than 100 hours. I do admit122 hours is a lot hours per week. Not many can really work more than that time frame. I guess that is the right hours

  14. COMPUTER SCIENCE GRAD

    Some brainwashed with wrong information type of individuals believe that a political affiliation is the
    cause of this slave wage trick. Too many individuals need to stop being STUPID. It does not matter what your political affiliation is. I suspect that a minimum of 90% of the politicians that are in office, regardless of political affiliation, do NOT represent “the people.” Instead of wasting precious time with marching and sit-in demonstrations in each state, pick a knowledgeable person from the group in each state to run in an upcoming election. Smart people don’t need million dollar advertisements and mudslinging, only the facts of what they plan to change and how they plan to change it. It would also help if mindless individuals would stop purchasing things they don’t need. Remember, the worst thing you can do to a rich person is make them poor. Between the politicians, the lobbyist, the banks, global corporations, and pharmaceutical companies, I am surprise America is not in worse shape.

    • Fred Bosick

      It’s not the fault of India or the H-1B visa holders from there. The responsibility is completely with the executive ranks of US public corporations and the venal politicians seeking campaign contributions.