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<<<<< JOB DESTRUCTION NEWSLETTER No. 1936 -- 11/09/2008 >>>>>

Pfizer continues to replace its American workers with H-1B contractors.
This newsletter has been reporting on the bloodletting at Pfizer for quite
awhile, so this isn't new news. There are a couple of new twists worth
mentioning however.

Item 1: Recently Senator Chris Dodd (D-CT) and Congressman Joe Courtney
(CT-2) sent a letter of concern to Pfizer. The letter asks the CEO of
Pfizer some interesting questions but it does nothing to stop Pfizer from
replacing its U.S. workers with H-1B visa holders. The reason these
Congressmen can't do anything to stop Pfizer is because replacing American
workers is legal. Dodd and Courtney are reduced to doing nothing more than
asking questions instead of demanding that Pfizer stop what they are doing.
It's not clear that Pfizer will ever answer the questions because they
aren't legally obligated to.

Sen. Dodd's letter should not be used as atonement for his legislative
history. He has consistently voted for H-1B increases as well as other
types of guest worker visas. Dodd voted for H-1B in 1990 and since then has
earned a grade of D- from Americans For Better Immigration for his
consistent support of increasing visas for foreign guest workers. In 2004
Dodd sponsored a bill that would put some mild restrictions on offshoring
government contracts but the bill died quickly. Since then Dodd has given
lip service to protect Americans from unfair competition due to the use of
H-1Bs or offshoring, while voting to make the problem worse. The letter
Pfizer was great, but it would be even better if Dodd sponsored some
serious legislation to stop the abuse. Don't hold your breath waiting for
Dodd to really do something.

Item 2: A document called Procedure 117 is getting a lot of publicity
lately. You can read it here:

Text of Procedure 117
http://media.theday.com/gbl/media/dynamic/pdfnews/proc117.pdf

Procedure 117 is definitely not a smoking gun. It's a rather mundane set of
Pfizer policies and procedures concerning contractors. It's not very
different than what I have seen at most companies who use contractors, and
it gives no clue about Pfizer hiring H-1Bs. The document says that
contractors cannot work at Pfizer for more than 12 months, which is fairly
standard in high-tech and doesn't necessarily mean that Pfizer will hire
H-1Bs, who are often contractors.

references:

http://www.eweek.com/c/a/IT-Management/Pfizer-Accused-of-Using-US-Worker...
Pfizer Accused of Using U.S. Workers to Train Foreign Replacements

http://www.pharmalot.com/2008/11/pfizer-trains-foreign-workers-as-it-rep...
Pfizer Trains Foreign Workers As IT Replacements

http://www.theday.com/re.aspx?re=a5d04996-c1f1-45d2-b60d-ea9c183ad35a
Critic links Pfizer Inc. to overseas job 'scam'

http://dodd.senate.gov/index.php?q=node/4617
Dodd and Courtney Express Concern Over Reports that Pfizer Will Cut Jobs in
Connecticut

+++++++++++++++++++++++++++++++++++++++++++++++++++

http://www.eweek.com/c/a/IT-Management/Pfizer-Accused-of-Using-US-Worker...

Pfizer Accused of Using U.S. Workers to Train Foreign Replacements
By Kevin Fogarty
2008-11-05

Pfizer's outsourcing contract with Infosys Technologies and Satyam Computer
Services means job losses for IT workers in Connecticut. Many U.S.-based
contractors are complaining that they are being asked to train H-1B workers
who will soon replace them.

Pfizer is taking flak for what detractors charge is a plan to use U.S.
workers to train the foreign contractors that will replace them during a
years-long outsourcing project.

Contractors in the company's Groton and New London, Conn., R&D facilities
-- many of whom are either former full-time staffers or replaced
Connecticut-based staff -- are complaining that foreign workers on H-1B
visas are coming in to be trained on the company's systems, according to
local newspaper The Day.

Those temporary workers are scheduled to return to India, where they will
run the same systems as part of an outsourcing deal Pfizer signed in 2005
with Infosys Technologies and Satyam Computer Services.

The complaints about IT contractors are part of a larger swell of
discontent focused on Procedure 117, a policy Pfizer instituted in January
that requires the closure of even long-term contractor arrangements as
those terms expire. It also institutes conditions -- and some say harsh
ones -- on which contractors in IT and other specialties may or may not be
able to continue to work with Pfizer.

U.S. Sen. Chris Dodd, D-Conn., and U.S. Rep. Joe Courtney, D-2nd District,
who represent the region, sent a letter to Pfizer asking the company to
reconsider laying off U.S.-based workers in Connecticut.

The situation, as reported by The Day, is unpleasant for U.S.-based IT
workers, but not terribly unusual for companies shifting IT operations
overseas during major outsourcing deals.

Calls to Pfizer requesting confirmation or comment were not returned. In a
public statement the company said it was continuing to evolve IT operations
"to meet global business challenges and look for efficiencies to help
better manage operations, which include the use of contract workers on an
as-needed basis."

Pfizer circulated an internal memo in 2005 saying it would try to cut $4
billion from its annual operating costs by 2008, largely by moving IT and
other operations from the United States and Europe to countries with lower
costs of living.

The memo, entitled "Evaluating Options: Moving IT Services to Low-Cost
Locations," outlined a plan to shift much of the company's IT operations to
Indian IT services firms Infosys and Satyam.

It's not illegal for companies to bring in H-1B workers for training, even
if they're there to learn how to replace U.S. workers, according to Ron
Hira, assistant professor of public policy at Rochester Institute of
Technology and co-author of "Outsourcing America."

"It's not surprising to have a company bring in [workers on] H-1B or L-1
visas to transition that work to companies like Infosys and Satya, which
are classified as H-1B-dependent because more than 15 percent of their work
forces here are on visas," Hira said. "Still, you shouldn't have to dig
your own grave by bringing in someone on an H-1B and training them to do
your job."

Pfizer has between 800 and 1,000 contractors working in Groton and New
London on any given day, alongside about 4,500 full-time workers, according
to The Day.

The IT outsourcing contract is only one part of Pfizer's overall
outsourcing and reorganization plan, which includes offshoring much of its
manufacturing and raw-material production and acquisition. Pfizer cut more
than 11,000 jobs in 2007 and closed a number of factories in an attempt to
save $2 billion in operating costs, according to Bloomberg News.

Much of the reconsolidation was sparked by the approaching end of the
patent and exclusive-manufacturing rights to anti-cholesterol drug Lipitor
and negative publicity about the effects of its anti-smoking drug Chantix.
The two are among the company's most profitable products.

Pfizer, the world's largest drug maker, announced in October that its
third-quarter net income had risen to $2.28 billion compared with $761
million in 2007, when it took a $2.8 billion charge for the failed
development of an inhalant version of insulin. The company said
cost-cutting played a major role in improving its net income during the
quarter.

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http://www.pharmalot.com/2008/11/pfizer-trains-foreign-workers-as-it-rep...

Pfizer Trains Foreign Workers As IT Replacements

6 Comments
By Ed Silverman // November 3rd, 2008 // 8:40 am

The drugmaker has been training foreign workers in its Groton and New
London, Connecticut, R&D facilities over the past few months in
anticipation of transferring much of its IT work from local contractors to
outside contracting firms, according to The Day.

The sources insisted on not being identified because they didn’t want to
be fired or lose a chance for re-employment. Some were hoping to retain
their jobs, and all were speaking with the expectation that, if the
upcoming changes at Pfizer are publicized, the drugmaker may reconsider its
decision to drastically reduce its local contracting force, the paper
writes.

The new policy, known internally as Procedure 117, will force many
contractors, or ‘contingent workers’, some of whom have been working at
Pfizer for a decade or more, to leave by year’s end, sources tells the
paper. Pfizer would not comment on what it called speculation and gossip.
"These rumors are distracting and hurtful to our colleagues who are working
together to deliver a pipeline of new medicines in areas of unmet medical
need," a Pfizer spokeswoman tells the paper.

Pfizer has between 800 and 1,000 contractors on site locally during any
given day, along with about 5,400 employees. More than half of the IT
workers in Groton and New London are contracted rather than being Pfizer
employees, sources said. Pfizer would not give a number for its IT work
force.

At the same time, the paper writes Pfizer is adding foreign workers, mostly
from India, who are arriving at R&D headquarters on controversial H-1B
visas. These special visas were created to allow foreign workers to take
jobs in the US that could not be filled by Americans, but Pfizer has been
using them to replace American workers, sources tell the paper. "We’re
training them," one source says.

Pfizer will not reveal how many H-1B workers it retains locally, though one
source put the number at anywhere between 50 and 100. But scores of other
foreign workers have been cycling through the local campuses over the past
several months in anticipation of moving much of Pfizer’s IT functions
overseas, sources tell the paper, though recent developments indicate the
company may be pulling back from some of these plans.

Many of the Indian nationals are employed by Indian-based service providers
such as Infosys Technologies and Satyam Computer Services and then leased
to Pfizer at rates in many cases much lower than American contractors have
been making, according to The Day.

One source tells the paper that a local technical writer might earn a rate
of $65 an hour (but pocket only $40 an hour, with the contracting firm
getting the rest), while an employee of Infosys working locally on a Pfizer
project might be paid $35 an hour (but pocket $20 to $25 an hour, with the
Indian service provider earning the difference). An offshore technical
writer would get even less, according to sources, perhaps $17 to $20 an
hour.

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http://www.theday.com/re.aspx?re=a5d04996-c1f1-45d2-b60d-ea9c183ad35a

Critic links Pfizer Inc. to overseas job 'scam'
Critic links Pfizer Inc. to overseas job 'scam'
By Lee Howard

Published on 11/8/2008 in Home »Business »Business Main Photo
A leading critic of a program that has allowed Pfizer Inc. to dramatically
cut its local information-technology work force says what's happening in
Groton and New London is a perfect test case to see if the new Democratic
administration is serious about stemming the flow of jobs overseas.
"The Pfizer situation is a clear, unambiguous case where loopholes in
immigration policies are being exploited to the detriment of American
workers and America's economy," said Ron Hira, an assistant professor of
public policy at Rochester Institute of Technology who has written widely
about the H1-B visa program and its abuses.

The H-1B program, originally intended to help U.S. companies connect with
foreign workers who have specialized skills not easily filled by Americans,
has devolved into a source of inexpensive labor to replace American workers
and a way to promote outsourcing, Hira said.

While the program's genesis in 1990 came at a time when the American
economy needed an influx of foreigners with special skills who could easily
be absorbed into the economy, those days are over, he said.

"The whole thing is basically a scam, and some people in Congress know it,"
Hira said. "They just don't feel compelled to do anything about it."

Among the abuses and bad effects of H-1B policies and procedures Hira has
documented are:

¦ The H-1B program allows foreign workers to come to the United States
for training and then rotate back to their home country as part of
systematic outsourcing efforts by U.S. companies.

¦ The original intent of the H-1B law was to find foreign workers to take
work that no American was willing or qualified to do, but the law now
states that companies do not have to look for American workers first.

¦ Companies do not have to demonstrate that a shortage of U.S. workers
exists and can, under certain circumstances, force a worker to train a
foreign replacement.

¦ H-1B workers are supposed to be paid the prevailing wage, which should
be at least the market wage, but many companies ignore this provision
because of loopholes.

¦ The H-1B program includes insufficient oversight, with employer
applications for H-1B workers essentially rubber stamped by the U.S.
Department of Labor. A September investigation of abuses in the system by
the U.S. Citizenship and Immigration Services found more than 20 percent of
H-1B applications were fraudulent or represented a technical violation.

At the Pfizer campuses in Groton and New London, according to a report
earlier this week in The Day, the company is implementing a year-old policy
that likely will result in hundreds of independent IT contractors losing
their jobs by the end of the year. Many of these jobs will be taken
overseas, according to sources, or be performed by foreign workers here on
H-1B visas and employed by Indian companies like Satyam Computer Services
and Infosys Technologies.

U.S. Sen. Chris Dodd, D-Conn., and U.S. Rep. Joe Courtney, D-2nd District,
responded to The Day's report by sending a letter to Jeffrey B. Kindler,
Pfizer's chief executive and chairman, asking that he confirm the company's
intentions and reconsider its plans. So far, Kindler has not responded.

"Mr. Courtney remains committed to protecting and increasing high tech
local jobs throughout eastern Connecticut," said Brian Farber, a Courtney
spokesman, in an e-mail.

Neither Courtney nor Dodd aides responded to detailed questions about their
records on the H-1B issue.

"Pfizer plays a critically important role in the economy of southeastern
Connecticut," Dodd said in a statement. "As a responsible corporate
citizen, it is Senator Dodd's hope that they would think long and hard
before they choose to outsource Connecticut jobs."

Hira called the response by Dodd and Courtney weak. If they truly wanted to
do something about H-1B abuses, he said, they would have asked for a
Department of Labor investigation of the situation. But Farber said
Courtney wants to find out more information before proceeding.

At the very least, Hira said, an investigation would have stopped the
process of workers being forced to train their replacements, since
companies that have been designated "H-1B dependent" cannot engage in such
practices. "H-1B-dependent" companies like Infosys and Satyam are those
that have a large percentage of their workers holding the controversial
visas.

"The H-1B program has been thoroughly corrupted," Hira, an American of
Indian descent, said in an article last year in The American Prospect.
"Rather than providing firms with workers who possess unique skills, the
program is dominated by low wage workers with ordinary, rank-and-file
skills. And, rather than preventing work from going overseas, the program
is speeding it up."

The problem, as Hira sees it, is that major corporations have huge
incentives to take advantage of H-1B loopholes, while those on the other
side are nonunionized IT workers. These workers simply don't have the
lobbying power to fight the corporations, he said.

H-1B visas and their abuse became a big controversy in 2003-04 in the
Hartford area, when many of the nation's largest insurance firms began
replacing their American workers with IT specialists from India. At the
time, former U.S. Rep. Nancy Johnson and Dodd wrote legislation geared
toward protecting American workers, but it didn't go anywhere, according to
Hira.

Hira said Dodd's attention to the H-1B issues appears to have waned since
then and U.S. Sen. Joe Lieberman, an initial supporter of foreign-visa
reform, has recently changed sides and is calling for an expansion of the
program with few protections.

Just this April, Lieberman, along with three Republican senators,
introduced the "Global Competitiveness Act of 2008" that would increase
H-1B visa levels from 65,000 to 115,000 over the next two years as well as
recapturing 150,000 unused H-1Bs and distributing them over a three-year
period.

"We must address the H-1B visa crisis to ensure that America remains the
world leader in innovation," Lieberman said in a statement at the time.
"Well-educated, highly skilled workers are key to our country's
competitiveness."

Lieberman did not respond to a request for an interview sent to one of his
aides. He did not join Dodd and Courtney in their letter to Pfizer.

Pfizer, according to a memo acquired by The Day three years ago, had
decided to outsource much of its IT work at that time, choosing India-based
services companies Satyam and Infosys. In case there was any question about
the reason for the move, the memo was titled "Evaluating Options: Moving IT
Services to Low Cost Locations."

Hira said he doesn't know how local workers will avoid displacement at this
point. But he's hopeful that president-elect Barack Obama will do something
about the H-1B problem, even though he has called for expanding the program
in the past.

"Here's a case where Pfizer is putting its profits ahead of its American
workers in a way that clearly skirts the spirit, and maybe even the letter,
of the law," Hira said.

"Will Obama put American workers first," as he promised in the campaign
when he chastised CEOs for putting profits ahead of American workers, he
asked. "Here's his chance to put his campaign promises into action."

L.HOWARD@THEDAY.COM

Regional

+++++++++++++++++++++++++++++++++++++++++++++++++++

http://dodd.senate.gov/index.php?q=node/4617

Dodd and Courtney Express Concern Over Reports that Pfizer Will Cut Jobs in
Connecticut
October 3, 2008

Senator Chris Dodd (D-CT) and Congressman Joe Courtney (CT-2) sent the
following letter today to Jeffrey B. Kindler, CEO of Pfizer Inc, expressing
their concern over recent reports that suggest the company has been
training foreign contractors to replace local workers at their facilities
in New London and Groton.

The full text of the letter is below:

November 3, 2008

Mr. Jeffrey B. Kindler
Chief Executive Officer and Chairman of the Board
Pfizer Inc.
235 East 42nd Street
New York, NY 10017

Dear Mr. Kindler,

We are writing today to express our concerns over media reports that Pfizer
has been training foreign contractors to replace local information
technology workers at the New London and Groton facilities as part of a
new, company-wide policy known as Procedure 117. In our view, any
reorganization that would result in the loss of jobs for local workers
would be troubling, and we would urge you in the strongest terms to
reconsider any such action.

We are also concerned that, thus far, Pfizer has not publicly released
information about any pending moves under Procedure 117. The only
information available has come piecemeal from the workers themselves, who
are understandably worried about the possibility of losing their jobs.

Given Pfizer’s critical importance as one of the largest employers in
southeastern Connecticut, we hope you will be able to provide us with
information regarding these potential workforce changes at Pfizer. First,
we would like to know if these press reports are accurate. If these
initiatives are indeed under consideration, we would appreciate answers to
the following questions:

How many workers will be affected by these
changes? Will any compensation be offered to those contractors who are not
re-hired?
How will the salary and benefit packages of those
who are retained following this reorganization be affected?
Of the jobs currently performed by Pfizer
employees or local contractors in Groton and New London, how many will be
relocated overseas?
How many workers in Groton and New
London will be replaced by foreign contractors residing in the United
States on H1-B visas? If skilled workers are already available for these
jobs locally, why does Pfizer find it necessary to hire workers from
abroad?

Thank you in advance for your response to this request. Should you have any
questions or wish to discuss this request further, please feel free to
reach out to us at any time.

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