Infosys: Federal Judge Denies Arbitration Motion in Whistleblower Lawsuit

By DHANYA ANN THOPPIL
BANGALORE -- Infosys Ltd. Friday confirmed a U.S. federal judge has refused to allow an out-of-court settlement in a case filed by one of its employees, a setback to the company, which is facing allegations of visa rule violations.

The Bangalore-based company declined to comment further, saying the matter was still before the court.

Jack Palmer, a principal consultant at Infosys, filed a lawsuit against India's second-largest software exporter by revenue in the Alabama state court earlier this year, alleging the company sought his help to circumvent U.S. visa laws. The lawsuit was later moved to the federal court.

Mr. Palmer accused Infosys of using short-term business visit visas to circumvent the fewer and expensive work visas meant for high-skilled labor. His suit led to a probe by U.S. authorities, including an inquiry by a U.S. Senate subcommittee. Infosys has previously denied any wrongdoing.

Infosys asked the court for an arbitration in the case, citing an agreement with Mr. Palmer when he entered into a contract with the company at the time of joining. The contract demands arbitration when an employee has a dispute with the company.

However, the judge agreed with Mr. Palmer's argument that Infosys' superior bargaining power as an employer leaves an employee with the choice of either taking the job or leaving it. Further, Mr. Palmer argued that few employees are in a position to refuse a job because of an arbitration requirement.


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