Walter Kruz, 52, who worked for Sun starting in May 2000 as a software engineering manager, claims Sun cut American workers and replaced them with workers from India who were younger and lower-paid. The suit alleges that Sun refused to rehire any of the laid off American workers, and that it developed a performance evaluation program that favored the retention of H-1B visa holders in order to save money.
"Ultimately, Sun's scheme was successful, allowing it to keep certain positions filled while dramatically reducing its labor costs," the suit said. "But Sun's preference for young East Indians and East Indian visa holders in its RIF (reduction in force) selection process discriminated against workers of other races and national origins as well as against workers over the age of 40."
The case is likely to fuel the fire over H-1B visas, which allow skilled workers into the United States for up to six years. Some tech workers have long questioned the need for such visas, claiming skilled Americans could fill the jobs and companies are just looking for cheaper workers. Tech companies, which successfully lobbied Congress for a higher H-1B cap during boom times, argue that they still need the workers for certain tasks. Although it's not illegal to hire or retain H-1B workers in lieu of American workers in most cases, employers must pay the "prevailing" wages for specific jobs in a region and the process cannot adversely impact a specific population of workers.
Kruz's suit, filed in Superior Court in Santa Clara County, Calif., seeks class action status on behalf of all "non-East Indian" employees that were affected by Sun's work force reduction policies. James Caputo, an attorney representing Kruz, estimates the class could encompass as many as 2,400 former Sun workers. The suit seeks unspecified damages and a jury trial.
The suit claims that Sun has a bias in favor of East Indian workers that is "an extricable part of its corporate culture. The suit also cites a 60 Minutes interview with sun co-founder Vinod Khosla, now a partner at venture capital firm at Kleiner Perkins Caufield & Byers, in which he said East Indians are "favored over almost anybody else."
Sun spokeswoman Diane Carlini said the company had not yet seen the suit, but she said the quotes were taken out of context. She said that Khosla, who is no longer an employee of the company, does not have sway over the company's hiring and firing practices, as far as she knows.
Khosla did not immediately respond to requests for comment.
Carlini also saidthat its H-1B practices violated labor laws. "It seems similar to what we've seen in the past where we have been cleared," she said.
It's hard to come up with an exact figure for the number of employment discrimination claims based on H-1B issues because such complaints are filed through a variety of disparate channels, including federal and state courts and agencies such as the Equal Employment Opportunity Commission. However, many laid off high-tech workers experiencing prolonged layoffs in a down economy are becoming more vocal in blaming H-1B workers and outsourced employment for their plight.
Caputo has filed a similar suit in federal court in Colorado on behalf of ex-Sun workers who are not California residents. In another similar case, former Sun worker Guy Santiglia charged the company broke laws related to H-1B hiring practices. Last month, a Department of Labor administrative law judge ruled that Santiglia, who decided midway through proceedings to represent himself, had failed to prove the company significantly violated employment law.