APSCo says that companies are bypassing UK IT workers

Data suggests Indian firms may be bypassing UK labour market

Data obtained using the Freedom of Information Act (FOI) reveals vast numbers of Indian IT workers are coming into the UK via intra-company transfers.

The data has prompted speculation that the companies concerned are bypassing the UK labour market and paying staff less than the market rate.

The Association of Professional Staffing Companies (APSCo) said that the data shows that 12,573 of the 29,240 IT workers entering the UK through intra-company transfers in 2008 came from seven Indian companies including Tata Consultancy Services and Infosys Technologies.

APSCo chief executive Ann Swain said the figures show how easy it is for foreign companies to bypass labour from the UK market.

She added: "APSCo has repeatedly asked the government to introduce checks that would prevent companies exploiting a loophole that allows them to employ thousands of foreign workers over those from the UK. But despite talking tough it has failed to take the necessary steps.”

Swain explained that as yet there was no requirement for companies to tap the UK labour market before transferring workers from overseas. She said: " Intra-company transfers account for about 80 per cent of all work permits issued in the IT sector.”

She argued that the majority of companies relocating non-EU IT workers to the UK are not British companies looking to plug skills shortages, but foreign companies with their headquarters abroad moving staff to UK subsidiaries.

There is also speculation that foreign companies are not paying UK-based workers the going market rate, resulting in competitive advantages for such firms and more incentive to implement intra-company transfers from abroad.

Swain's comments supported this view: "Foreign companies are supposed to pay workers brought into the UK the going market rate, but I wonder whether there isn't some economic benefit to transferring Indian workers from a low wage economy to the UK. If there is no cost-saving, then why do they do it? "

The firms named in the documents obtained by APSCo are Tata Consultancy Services, Infosys Technologies, Wipro Technologies, Cognizant Technology Solutions, Tech Mahindra, Satyam Computer Services and HCL Great Britain.