Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/234433 
Year of Publication: 
2021
Series/Report no.: 
GLO Discussion Paper No. 855
Publisher: 
Global Labor Organization (GLO), Essen
Abstract: 
This study explores what determines employers' violations of the wage contracts of workers on H-1B temporary work visas, which occur when firms pay those workers below the promised prevailing or "market" wage. A theoretical framework is proposed that predicts more violations during economic downturns, fewer violations when firms have more labor-market power, and more violations by subcontractor firms. Empirical analysis is based on a firm-level matched dataset of wage and hour violations and the firms that sponsor H-1Bs. Higher labor market power, measured by the Herfindahl-Hirschman Index, is associated with fewer violations. Higher unemployment rates and subcontractor firms are associated with more violations. The effects of the unemployment rate and labor market power are amplified in subcontractor firms.
Subjects: 
wage theft
guest workers
H-1B workers
labor market competition
wage and hour laws
monopsony labor market
JEL: 
J31
J38
J42
J44
Document Type: 
Working Paper

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