Call Center Offshoring Bill Being Pushed by Two Senators

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Two Democratic Senators this week are pushing a bill they introduced last month aimed at keeping call center jobs in the U.S. The bill would require the federal government to give contract award preference to companies that do not offshore call center work, create a list of those that do ship jobs to other countries, and prevent such companies from receiving federal loans and grants.

U.S. Senators Sherrod Brown (D-Ohio) and Bob Casey (D-Pa.) this week separately discussed Senate Bill 3402, titled “The United States Call Center Worker and Consumer Protection Act,” introduced by Casey in July. Brown is currently the sole co-sponsor of the bill.

Casey pushed the bill in a speech in Allentown, Pa. Monday. “Companies that outsource their call centers overseas shouldn’t see the benefits of government grants and loans,” said Casey. “Keeping call center jobs in the Lehigh Valley is good for our workers and our economy, and passing my bill will send a clear signal that outsourcing jobs will not be rewarded.”

Brown highlighted the bill at an event in Cleveland on Tuesday. “This bill will also stop giving American tax dollars to big businesses that ship call center jobs overseas. Why should we hand over federal grants or loans to companies that hand over American jobs to other countries?” said Brown. “We should reward American workers and American companies that remain loyal to creating jobs in our communities.”

Specifically, the bill would:

  • Require companies to disclose to callers when their calls are transferred abroad;

  • Make businesses that move call center jobs overseas ineligible for federal grants or loans;

  • Direct the Department of Labor to make a public list of such companies (employers would remain on list for three years after each relocation); and

  • Require agencies, including Department of Defense, to give preference to U.S. employers that do not appear on the list.

While Brown and Casey are currently the only sponsors of the Senate bill, there is a companion bill in the U.S. House with more than 100 co-sponsors, at least six of whom are Republicans. That bill, H.R. 3596, was introduced late last year with nearly identical language. It is currently in committee.

The topic of overseas outsourcing has always been a hot topic in the ARM industry. Many debt collection agencies use offshore resources in their business, and many others are vehemently opposed.

The issue ignited last month in a long discussion thread in a popular ARM industry LinkedIn group. The back-and-forth between group members on the polarizing topic illustrates what many business leaders in the U.S. feel on both sides of the issue.

One of those involved in the discussion, MRS BPO Co-CEO Jeff Freedman, told insideARM.com that his experience with offshoring revealed a much more nuanced reality than “shipping jobs overseas.”

“By taking extremely low unit yield work and placing it off-shore, I was able to take a portfolio that was losing money and make it profitable,” said Freedman.  “In our case, this is work that my US staff never wanted to work anyway since they were not making bonus money on it.”

Freedman noted that by sending those accounts overseas, the same client increased its placements with MRS leading to an increase in U.S.-based collection staff.

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Posted in BPO, Collection Laws and Regulations, CRM, Debt Collection, Featured Post .

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Continuing the Discussion

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  • avatar Fred Landrum says:

    I have written to both our our Senators urging them to support this bill and urge everyone else to do the same. In deference to Mr. Freedman, there are low-cost alternatives to sending work overseas such as finding subcontractors in rural areas with a lower labor cost.

  • avatar Ryan Barker says:

    I have also email my representative asking them to support this bill. For me it is not so much a job creation bill as a questions of consumer data security. Too much risk off-shore and no way to deter ID theft.
    If we were able to bring back collections/service from off-shore it would produce a nice opportunity for the younger generation to get a start in the private sector. These “kids” have been in school for so long they forget that production is a requirement of any job. What better place than collections to teach them daily/weekly/monthly goals? What better place to teach service?
    Bring back these jobs and the companies will be more profitable with the most productive work force in the world. We do have to repeal the affordable heath care act in order for this to work. :)

  • avatar harry-ramos says:

    We can do without another group (off-shore collectors) that gives our industry a bad name.

  • avatar Michael Ryalls says:

    I agree with Jeff Freedman’s comments in this article. Although the headline might be great for garnering votes, in reality, much of the work that is outsourced cannot be done profitably in the US. Having an offshore option has allowed RGS to accept additional opportunities and to grow our US operations as a result. Since some clients require it, blacklisting a company for merely having the offshore option available is counter-productive. Ironically, the reason that offshore is occasionally a better option is because of, not in spite of, the government’s involvement.

  • avatar DONALD DALY says:

    Anyone who does not support this legislation should totally fund the operation with private funds. Any job that leaves this country is a job lost to the U.S.A.! Anyone who puts profit above being a responsible citizen deserves nothing from the taxpayers of this country or government assistance in loans or contract, in any form. Since the few who support transferring American job oportunties off shore find it so profitable, find your foreign clients and fund it yourself. I would go one step further, any organization that refers accounts should also be added to the list and deemed ineligible for any type of government loans or contracts for the same period of time. This country is in trouble and it’s crap like this that is the root of the problem.

  • avatar Collection Veteran Since 1964 says:

    As far as the comment that stated “clients require it” it is time this industry steps up and tells the client no dice. I know the response will suggest, they will go elswhere to get someone to do off shore or every one is doing it. If ARM companies stood their ground then we all would be better off. The banks that require any ARM company to do off shore collections may want to look at their own problems concerning mortgage loan and consumer loan and customer services when a consumer can’t even understand what the caller is saying, plus the privacy risks. Ironic that those who require off shore collections have reduced ARM contingency fee rates at the same time and contributed to economic crisis because of greed. Time to stand up ARM industry.

  • avatar Michael Ryalls says:

    Interesting thread on this issue and there is obviously a lot of passion in the arguments. This is not dissimilar to the “buy American” debates that have gone on for years. One important distinction here is that these jobs would not and could not be housed in the US. We are not displacing American jobs by outsourcing selected contingent collection work offshore. The “selected” accounts would never be worked in the US because of score range, balance, age, or other combined factors. Assessing the two options of ignoring them and therefore leaving them uncollected, or outsourcing and thereby collecting, I prefer to look at it as importing recoveries, not exporting jobs. The accounts are not collectable in the US but they do pay if managed correctly offshore. Data security, compliance issues, and active management are all critical to the overall program but it can be done. Recovery rates improve, critical capital is returned to US clients, and the agency can make more money which grows our businesses. I would much prefer our legislators put their talents towards an FDCPA fix for FOTI or working to lower the costs of operating a small business.

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