UK IT contractors are being forced to train overseas workers to take their jobs.
Businesses are bringing overseas staff to the UK to cut costs by using Intra Company Transfer (ICT) migration rule, which is not meant for this purpose. This is in addition to increased offshoring to countries such as India to cut costs.
The Migration Advisory Committee (MAC) will today publish a report on the ICT rule in response to complaints about its overuse and misuse, particularly in the IT sector.
Offshoring to cut costs and using ICT to bring cheap offshore labour onshore is reducing UK IT jobs and damaging UK skills in the process, say IT contractors.
The ICT scheme was introduced to allow businesses to bring in people with important skills that the company could not source within the UK. But these rules are being used to bring in cheap labour, claim IT contractors.
IT contractors that have contacted Computer Weekly have spoken of their experiences of offshoring and alleged ICT abuse by UK corporates.
Onecontractor, who wished to remain anonymous, said he hadworked at several large businesses that have used the ICT rule to bring people into the UK. "They co-own Indian IT companies and bring in a whole load of Indian workers for skills that they could find in the UK."
According to data obtained by the Association of Professional Staffing Companies from the Home Office under the Freedom of Information Act, 35,430 non-EU IT workers came to work in the UK last year. This compared to 12,726 during the dotcom boom in 2000.
The contractor said: "UK contractors have been cut at one company he worked at and permanent staff have to train their Indian replacements, who will eventually take the permanent staff jobs as well."
Another IT contractor working for BT for over four years said BT decided to replace an entire team based in Leeds with staff from Tech Mahindra. These workers were paid rates littlemore than half of the rates UK staff were paid, he said.
"There was no pretence that they could not find staff in the UK. They were doing it to cut costs."
He said BT awarded a contract to Tech Mahindra, which has a UK presence, and foreign nationals were brought in to replace UK staff.
"The staff that came over did not know what they were doing," he said. "We had to train them."
BT said the deal with Tech Mahindra is part of its massive cost cutting programme. The UK telecoms companymade thousands of redundancies last year and is planning the same this year. "The majority of these will come from contractors rather than permanent staff because contractors are paid a lot more money."
BT announced last year that it planned to spend more than £1bn over the next five years with Tech Mahindra, which it has a 31% stake in.
"We have replaced some contractors with Tech Mahindra people as part of a global outsourcing deal BT signed with the company in March 2008. No permanent staff have been replaced," he added.
The number of Tech Mahindra staff working with BT in Leeds is around 120.
BT said the contract is outsourced to Tech Mahindra so it has no influence in the staffing.
Tech Mahindra said: "Our operations in the UK complieswith all the prevalent laws governing immigration and work visas. Employees are transferred to the UK if and only if their particular skills are needed to execute a client's projects."
BT announced last month that it was actually cutting 4,000 contract call centre jobs in India and bringing some of the work back to the UK.
One IT contractor, who worked for the RoyalBank of Scotland as a mainframe technician for a number of years, told Computer Weekly business-critical work hadbeen moved to India to cut costs.
"RBS started moving the work we were doing to its datacentre in Mumbai, known internally as Indian Datacentre. I had to train Indian workers to do my job."
"This was to cut costs and not about filling a skills shortage. They move the jobs to India because it is cheaper," he added.
RBS said in a statement: "As a result of our acquisition of ABN AMRO we now employ 8000 people in India serving our operations globally and we employ more than 70,000 people outside of the UK. In the last year we have been progressing with work to integration the two businesses and develop all our centres in UK, India and across the globe."