Fired US Disney Workers Sue Over Having To Train Foreign H1-B Replacements

One has to question the analysis - and management decision making that somehow led an otherwise generally savvy company to assume that saving a few million dollars by replacing fired American workers with less expensive foreign contractors was worth it.

Unless the real goal is access to the Indian market. JL

Joe Mullin reports in ars technica:

Former IT workers at Disney have sued, saying that Disney broke the law when it hired cheaper foreign replacements, then fired its current IT department. Disney IT employees were told "if they did not stay and train they would not get a bonus and severance."
Two former IT workers at Disney have sued, saying that Disney broke the law when it hired cheaper foreign replacements, then fired its current IT department. Disney IT employees were told they would be kept on for 90 days in order to train their replacements, who were H-1B visa holders, according to the complaints. The workers were told "if they did not stay and train they would not get a bonus and severance, which most employees reluctantly accepted."
Both lawsuits are proposed class-actions, filed in federal court in Florida. The suit filed by Dena Moore (PDF) names Disney and labor contractor Cognizant Technology Solutions, while a complaint filed by Leo Perrero (PDF) names Disney and HCL, another labor contractor.
They make a novel claim, saying that Disney violated the anti-racketeering RICO statute by engaging in a "conspiracy to displace US workers." The plaintiffs allege that Disney and the contractors weren't truthful when they filled out immigration documents, thus violating a section of the RICO law that bars "fraud and misuse of visas, passports, and other documents."

"Each making of false and fraudulent statement[s] on an individual visaholder’s H1B application constituted a separate racketeering act," the complaint states.

Displacement or expansion?

H-1B visas are supposed to be used in situations where a job cannot be filled by a US worker with equal or better qualifications. Employers hiring with H-1B must agree to "labor condition statements," which state that the hiring won't cause the employer to displace US workers. Those statements must be filed with the Department of Labor before the employer can file an H-1B visa petition.
Perrero and Moore are part of a group of Disney IT employees that was laid off last year. They estimate the total number to be between 200 and 300 workers. When the controversy erupted last year, Disney said around 135 IT workers had lost their jobs.
In November, Sara Blackwell, the attorney for both Perrero and Moore, filed a complaint with the Equal Employment Opportunity Commission, or EEOC, on behalf of 23 of the laid-off Disney workers. That's a necessary first step before filing a discrimination lawsuit. In that complaint, workers complained of discrimination based on age and national origin. The lawsuits filed yesterday don't include discrimination claims and focus solely on the alleged RICO violations.
The affected employees have also begun to speak up. Perrero and a colleague were interviewed in October for a report that aired on WWSB, an ABC affiliate based in Orlando. "I felt extremely un-American,” Perrero said, describing his feelings about training his replacement, who was from India. "I felt like I was part of destroying our economy because I had to train a replacement that was going to come here, take my job and potentially take other people's jobs."
Perrero told the TV reporter his experience convinced him to leave the IT field entirely. "I would never recommend this field to anybody who's a student, because of the lack of opportunity," he said.
Disney acknowledged it had moved some IT jobs to Indian workers but told the TV station it was also adding and expanding jobs for US IT workers.
A Disney spokesperson told Ars via e-mail: "These lawsuits are based on an unsustainable legal theory and are a wholesale misrepresentation of the facts. Contrary to reports, Ms. Moore was offered another position in the company at comparable pay, and more than 100 of the workers affected by the changes were rehired."