Federal jury finds that Cognizant discriminated against American IT workers

A federal jury has found IT consulting firm Cognizant guilty of discriminating against American IT workers.

The court case, Palmer v. Cognizant Tech. Solutions Corp., was argued in Los Angeles at the US District Court for the Central District of California.

The jury also determined that Cognizant should pay punitive damages to compensate the former employees found by the jury to have been victims of discrimination.

The amount of those damages will be determined by the court at a later date. “Counsel are ordered to meet and confer and within two weeks file a Joint Status Report regarding how to proceed on the Court Trial phase of the case,” where the judge will determine the amount, said the court’s docket filing. “Counsel shall set forth their proposal regarding the dates and/or process for resolution of the disparate impact claim.”

Many of the allegations suggested that Cognizant was exploiting loopholes in the H-1B visa lottery system, specifically by getting rid of American employees and then replacing them with Indian workers via H-1B.

Cognizant declined an interview to discuss the verdict, but emailed a statement saying that it would appeal.

“Cognizant is disappointed with the verdict and plans to vigorously defend itself and appeal at the appropriate time. We provide equal employment opportunities for all employees and have built a diverse and inclusive workplace that promotes a culture of belonging in which all employees feel valued, are engaged and have the opportunity to develop and succeed,” the statement said. “Cognizant does not tolerate discrimination and takes such claims seriously. Christy Palmer v. Cognizant was initially filed in 2017 and addresses plaintiffs’ claims dating back to 2013.”

That last line is interesting, insofar as it suggests that Cognizant is arguing that this all happened 11 years ago, which is a lifetime in IT circles. 

The overall issue is not unusual, in that many IT outsourcing and consulting firms have found that Indian workers tend to accept much lower compensation and are more tolerant of a lack of work-life balance than some other nationalities. Another global outsourcing firm, who wanted to remain unidentified, said that it has been able to hire talent from India at roughly one-tenth the compensation required for their US counterparts.

In the original court complaint, plaintiffs argued that although “only about 12% of the United States’ IT industry is South Asian, at least 75% — if not more — of Cognizant’s United States workforce is South Asian, primarily from India. This grossly disproportionate workforce is the result of a pervasive and egregious discriminatory scheme to favor South Asians and disfavor non-South Asians in hiring, promotion, and termination decisions. Cognizant’s employment practices violate the Civil Rights Act of 1866.”

The lawsuit also alleged a specific fraudulent scheme related to H-1B.

“Cognizant’s invitation letters are routinely false and the jobs that Cognizant represents in visa applications as available and requiring staffing routinely do not exist. The federal government then awards visas against these fictitious positions,” the lawsuit said. 

In its initial reply to the lawsuit, Cognizant denied that there was discrimination and suggested that the plaintiffs were not cooperative with HR during probes into the allegations.

“To the extent any Plaintiff intended to allege hostile work environment claims, such claims are barred because Cognizant acted reasonably in accordance with Cognizant’s policies by exercising reasonable care to prevent and promptly correct any alleged discriminatory behavior, and Plaintiffs unreasonably or untimely failed to avail themselves of preventive or corrective opportunities provided, or otherwise failed to avoid harm,” Cognizant’s response filing said.