Dishonest Filipino Recruiters A Threat To U.S. Employers

It was a very steamy day in Manila, Philippines, on July, 1995, and I was even more uncomfortable than I usually am in a suit and tie.  I was seated at the office of the director of the Philippine Overseas Employment Agency (POEA), having been invited via a common contact at the U.S. embassy in Manila.   (The POEA is tasked with insuring that the Philippine's most valuable "export" and its primary source of income — skilled Filipino professionals working overseas –  are treated fairly by their overseas employers.) Opposite me, with beady little eyes, sat the attorney for the organization, and he was irritated.  He saw my presence – and my credentials as a former U.S. diplomat and, at the time, owner of a health care recruitment agency in Florida - as an offensive intrusion on his legal turf. 


The start of the conversation was, accordingly, a bit uncomfortable.  I sat there and listened to the attorney describe how the existing rules made it "impossible" for FIlipino professionals to fall victim to unscrupulous recruiters and U.S. employers, nodding, until the director asked me the right question:  "What other ways could our workers fall victim to dishonest dealing if we have all this in place?"


For the next hour and a half or so, both of them sat -transfixed is probably not too strong a word — as I gave them example after example of ways that I could, were I dishonest and ready to exploit the folks I was recruiting, essentially paint them into a corner of de facto indentured servitude.  By the time I left the POEA office, the lawyer was my friend and the director asked me to consult with them on rewriting the rules, which they did over the next few years.


Fast forward to yesterday's news as reported by USA Today, NPR, and most major news agencies:


Unions representing teachers in Louisiana filed a complaint with state authorities alleging that a Los Angeles recruiting firm broke the law by holding more than 350 Filipino teachers -all in H-1B visa status – in "virtual servitude" in order to hold onto their jobs in five Louisiana parish school systems, including New Orleans' Recovery Zone.  The Louisiana Federation of Teachers and its parent organization, the American Federation of Teachers (AFT), accuses California-based Universal Placement International of charging Filipino nationals about $15,000 apiece to get jobs — more than 40% of some new teachers' salaries in a few Louisiana parishes — and required that they pay 10% of their monthly salary for two years to keep them.  The two unions want the firm to repay the fees to teachers and want the state to invalidate Universal's contracts and prosecute its officials.


As you can tell from my intro to this story, this is nothing new.  When my recruitment company was bringing in Filipino nurses and rehab professionals (a venture which lasted about a year, until Florida's DPR made temporary license issuances a colossal ordeal), we were the only agency which was NOT charging an up front "consideration" fee for interested candidates…100% of our compensation came from placement fees paid by the U.S. employers who asked us to find them workers.


I cannot help but wonder how the AFT and other good folks who have brought this latest calamity to light can treat this as startling.  AFT President Randi Weingarten was quoted in USA Today as saying that it would be ""mind-blowing that a recruiter could actually get away with this. Even if it was an isolated incident, it would be horrible, but my hunch right now is that it's not isolated."


Your hunch, Ms. Weingarten, is right on the money, and nothing new.

In fact, just two weeks ago, Global Nation (a leading online resourse for Filipinos working abroad) published an article indicating that, according to the POEA itself, some recruitment agencies whose licenses have been suspended or cancelled by the POEA were still actively recruiting abroad.  In a statement, POEA Administrator Jennifer Jardin-Manalili said that for 2008 and the first six months of 2009 alone, the POEA cancelled 76 licenses and suspended or fined 57 agencies as a result of recruitment violations.

Folks, this isn't just about exploited workers. This is about U.S. employers who rely on staffing agencies to recruit from abroad.  As noble as the intervention of the teachers' unions is, and as outraged as we are at the revelations of this particular situation, there is something no one seems to remember: under federal labor and immigration laws, employers cannot hide behind independant contractor or agency relationships to indemnify themselves from violations of U.S. labor and immigration laws.  Put simply, the sins of the hiring company become, at least technically, the sins of the employer. Inequitable as it would be, if the U.S. employer of these H-1Bs were a private corporation instead of the beleagured state of Louisianna, an ICE investigation — and great big sanctions — would be in order.

Talk to me before you hire from abroad, okay?  And have a great weekend.