A company has been banned from arranging special visas for foreign college students to work in the US, following complaints about poor working conditions.
The State Department estimates that the rule change will cut 5,000 to 8,000 jobs
In a rare move, the US State Department revoked its certification for the non-profit Council for Education Travel USA (CETUSA), after some students sponsored by the company spent weeks protesting about their working conditions at a Pennsylvania factory that packed Hershey chocolates.
They complained of hard physical labour and pay deductions for rent that often left them with little money.
Now CETUSA can no longer bring in students under the J-1 Summer Work Travel programme.
It is rare for the State Department to take such action. A department official said the company lost its designation on January 30 – nearly six months after the workers began protesting. Nearly 400 students worked at the plant.
A message left for CETUSA, whose corporate office is in San Clemente, California, was not immediately returned. The company’s website said it has sponsored tens of thousands of students from more than 50 nations since 1995.
The State Department’s action comes a year after an Associated Press investigation exposed widespread abuses in the J-1 programme, which every year allows more than 100,000 foreign college students to work in the US for up to four months.
It comes the same week that the AP obtained a January 18 State Department memo proposing a major overhaul of the troubled scheme.
“The State Department is to be commended,” said Danielle Grijalalva, executive director of the Committee for Safety of Foreign Exchange Students.
“However, we will continue to look to the US Department of State to make sure its sponsors adhere to the Federal Regulations which were written to protect foreign students.”
The overhaul memo was written by Adam Ereli, assistant secretary for the State Department’s Bureau of Educational and Cultural Affairs, to assistant secretary of state Ann Stock.
It outlined critical and significant changes to the programme, which has been a source of embarrassment for the agency. Late last year, secretary of state Hillary Clinton ordered a thorough review of the scheme.
The proposed changes would ban students from working in factories, manufacturing, retail shipping and packing operations and seafood plants.
The agency also plans on “re-emphasising the adult entertainment industry prohibition by specifically prohibiting jobs with escort services, adult book/video stores, massage parlours, and strip clubs”.
Another change proposed is capping the number of hours a student could work at 40 – a move the agency predicted would be “by far the most controversial”.
“Almost all SWT employers expect their participants to work more than a 40-hour week,” Mr Ereli wrote.
Critics say that is one of the problems with the programme. Students, like the ones in Pennsylvania, are often exploited – working long hours with no overtime and forced to live in sub-standard housing.
The AP interviewed dozens of students across the country who complained about working conditions, many in resort areas in Florida, the Carolinas and Pennsylvania.
Saket Soni, director of the National Guestworker Alliance, an advocacy group that helped the students, said the ban was a “big win” for students and called it “a blow against the larger trend of labour recruiters and companies using guest workers to hollow out industries and undercut wages and conditions all over America”.
The AP also found that third-party brokers forced some women – mostly from eastern European nations – to work in US strip clubs.
The State Department estimates that the rule change will cut 5,000 to 8,000 jobs, of which two-thirds were “highly localised in Alaska and the Pacific Northwest”.
But Mr Ereli warned that sponsors and businesses that depended on the student labour could push back.
“The seafood packing industry and the sponsor that supply workers to the industry are making a concerted effort to oppose this prohibition,” he said in the memo.
The J-1 programme began in 1963 as a cultural exchange. Participants must be college students in their home countries and are required to work while spending their summer breaks in the US.
The idea was to allow them to make money and explore and learn about America in the hopes of fostering cultural understanding.
But over time, the programme became as much about staffing businesses as cultural enrichment. Businesses that hire a foreign student over an American can save eight per cent because they do not have to pay Medicare, Social Security and unemployment taxes. The foreigners must also have their own health insurance.
Many businesses insist they need the seasonal labour during busy times, especially in resort towns. The students can be found waiting tables, flipping burgers or cleaning hotel rooms across the US.