Infosys, India's second largest IT firm, has been cleared of visa violations by the US government after a three-month probe, the company said on Tuesday.
"Infosys is pleased to report that the US Department of Labour (DOL) concluded its investigation with a determination of compliance regarding labour condition applications filed in the Southern California Edison project. Infosys fully cooperated with the DOL in its investigation, and over 145 files were reviewed, with no violations found," the company said.
In June 2015, the US government had ordered an investigation to probe alleged violation of rules pertaining to H-1B visa by Infosys and Tata Consultancy Services (TCS).
The probe was initiated after two US Senators alleged that the two companies misused an H-1B visa programme to "replace hundreds of American workers" at an electric utility, Southern California Edison. Prior to the investigation, Southern California Edison had laid off over 500 technology workers.
"Many said they were made to train replacements who were immigrants on temporary visas, known as H-1B, brought in by the Indian firms, Tata Consultancy Services and Infosys", an NYT report said.
But Infosys has denied indulging in unfair practices.
"We do not practice or condone unfair or unethical H-1B visa practices. Our key priority is to operate fairly, ethically and with integrity, which is good business and what our clients expect," said Sandeep Dadlani, EVP and Head of Americas of Infosys.
In another similar instance, an American IT professional, who worked with TCS, had filed a lawsuit against the company in April, accusing the company of practising discrimination against Americans in its US offices and favouring South Asians in hiring and promotion.
Indian IT companies are among the top recipients of H-1B visas issued by the US government. The visas allow companies to hire highly skilled workers from other countries when there is non-availability of such workers in the US.
Responding to the development, the Infosys stock rose more than 1% on Tuesday morning to trade at Rs 1,070, while the benchmark Sensex climbed over 190 points.
Analysts are bullish on the stock. "We maintain our BUY with a price target of INR 1306 and remain positive on the IT space," said Sarabjit Kour Nangra, VP Research, IT & Pharma, Angel Broking.