‘Pay your own H-1B salary or lose visa’: How some techies battle ‘labour trafficking’ in US 

In the recent episode of Area 51 podcast, Rahul Menon spoke to immigration lawyers Brad Banias, and Jay Palmer (who acted as a whistleblower in a major immigration fraud case involving a tech giant), on how many techies are working on cases where Indian workers face serious exploitation in the US tech system.

How the H-1B dream turns into trouble for some Indian workers 

Many Indian workers, especially fresh graduates on OPT or first-time H-1B holders, join small IT staffing companies often called “body shops.” These firms promise visa sponsorship and good salaries, but the reality, according to the podcast, can be very different. Brad Banias explained a key issue: “You’re entitled to a prevailing wage. Period.” 

He said some companies use “80/20 splits,” where workers are promised 80% of what the client is billed. But when there is no project, often called “benching,” workers are not paid at all. This directly goes against H-1B rules, which require payment of at least the prevailing wage or actual salary. 

In some cases, workers are even told to mark themselves as being on leave so the company does not have to pay them. 

Palmer supported this, saying he has seen fake payroll systems where workers are shown as paid on paper but receive nothing. He also described situations where employees were forced to pay their own visa filing and extension costs. In extreme cases, workers were asked to withdraw cash and hand it back to managers as kickbacks. Some were even made to “pay their own salary” just so payroll records looked clean for immigration checks. 

Exploitation claims begin after H-1B lottery selection in US tech jobs

In the first case, Misala vs. Progress Solutions in Texas, an H-1B worker has alleged that he was forced to pay his own wages and immigration expenses during bench periods. He also claimed the company threatened his visa status and even contacted his father in India to pressure him. Important documents and pay records were allegedly withheld, making it difficult for him to switch jobs. 

The second case, Vallabhaneni vs. Siri Software Solutions in New Jersey, involves serious allegations of long-term exploitation. The worker, Amrutesh Vallabhaneni, reportedly claimed he had to pay large sums out of pocket, around $52,000 in one year, to keep payroll records active while working long hours. He also alleged threats that his H-1B and green card process would be stopped if he did not comply. 

 What ‘Labour Trafficking’ means in these cases

The speakers also explained something many people find surprising, the use of the term “labour trafficking” in white-collar tech jobs. Under the US Trafficking Victims Protection Act, it can include situations like:

Debt bondage, where workers are forced to pay recruitment fees, visa costs, or even their own salary. Document control, where pay slips or important papers are withheld so workers cannot switch jobs. 

Forced labour, where people feel trapped because their legal status depends on their employer. And recruitment-based exploitation, where promises of good jobs turn into controlling or abusive conditions. 

Banias explained, “When an employer reaches out to you and says, ‘Hey, come join my company… I’ll give you 80% of whatever you bill’… they’re now recruiting you, and then you’re going to be a victim of forced labour.” 

Palmer added that in some situations, workers are kept in crowded housing, asked to find their own clients, and sometimes even threatened with immigration enforcement or pressure on their families back home. 

He also added that this issue is especially complex because it often involves people from the same community, and long green card wait times for Indians, sometimes 10 to 15 years, make workers more dependent on H-1B status. 

Warning signs workers should not ignore

According to Brad Banias, there are some clear red flags that workers should watch carefully. These include job offers that promise payment as a percentage of billing instead of a fixed salary, contracts that include heavy penalties if the worker leaves early, pressure to stay in company-run housing that later becomes expensive, requests to find your own client, or any manipulation of pay records.

There have also been reports of cash payments being demanded or money being sent back to managers.

Palmer stressed one thing repeatedly: “Documentation, documentation, documentation.” He advised workers to keep emails, messages, bank records, and any communication that shows what is happening.

Both Banias and Palmer agreed that while the H-1B system brings skilled workers and helps US companies grow, fraud and exploitation damage everyone involved. Palmer, who says he has faced backlash for speaking out, called it a “purple problem,” meaning it is not tied to any political party.

He also explained that even lower salaries in the US can still seem attractive when converted into Indian rupees, which sometimes makes workers accept unfair conditions. Family pressure and the idea of “adjusting for a few years” also play a role.

Disclaimer: This article is for general informational purposes only and does not constitute legal, immigration, or tax advice. Immigration laws and government policies are subject to frequent change without notice. While we strive to provide accurate updates, readers are strongly advised to verify the latest requirements with the official embassy, consulate, or government portal of the respective country. Financial Express is not responsible for any decisions made based on this information. For personalized guidance, please consult a qualified immigration attorney or a certified professional advisor.