NEW YORK: In yet another instance of ‘knowledge transfer’ – the dubious practice of having current employees train their replacement workers from an IT outsourcing firm before being fired – the Pacific Gas and Electric Co. (PG&E) is using H-1B visa workers from Tata Consultancy Services (TCS) to offshore 72 IT jobs from San Francisco to India.
PG&E is using the ‘knowledge transfer’ method which has been used by several other American companies in the last couple of years to cut cost, including Disney and Southern California Edison.
PG&E previously announced a restructuring plan to terminate approximately 390 full-time support services jobs and 800 non-employee contractors, while leaving 500 open positions empty, reported the San Francisco Business Chronicle. Laid-off San Francisco IT workers at PG&E were offered 15-day temporary contracts through February 10 to train the H-1B visa holders from TCS.
When PG&E was contacted by the SFBT about offshoring jobs to Mumbai, company spokesman Brian Hertzog stated: “The focus is really on doing the right thing for our customers and the right thing for the business over the long term. That’s what this is about, and it’s what drove the decision.”
Hertzog added that the replacements are currently in the US on H-1B work visas to learn IT jobs, phase out older applications, and then transfer the tasks to workers in India. Although Hertzog stated that the roles of the terminated employees would have been phased out anyway, he acknowledged that PG&E’s IT group would contract for 100 H-1B Visa holders to do work the company calls more strategically focused and of higher value, reported Breitbart.
Paul Almeida, president of the AFL-CIO’s Department for Professional Employees, told the Chronicle: “It’s knowledge transfer.” He complained, “They’re just transferring the knowledge of the business to these foreign countries through these outsourcing firms.”
Earlier, Southern California Edison made a similar move in 2015 by outsourcing 500 American jobs by using H-1B visa workers. Last year, in September, the University of California announced its San Francisco campus would dump 17 percent of its IT employees by February 2017 and replace them with contract H-1B visa holders from India. The cuts were aimed at eliminating 67 permanent employee positions — complete with generous pensions — as well as 20 American contract workers, reported Breitbart.
On the flip side, PG&E have come under criticism for passing on higher costs to their consumers. The Sacramento Bee reported a 13% increase in natural gas rates that took effect in August, but consumers didn’t feel the pinch until December, when residents turned up their thermostats in the face of a particularly cold and wet season. Electricity rates were raised three times in the past year. Combined, electricity and gas rates for PG&E customers are an average of 21 percent higher than they were a year ago, said utility spokesman Donald Cutler.
It remains to be seen if PG&E will pass on the savings from outsourcing the 72 IT jobs to India to their customers, or not.