The proposed restrictions require firms that receive money under the federal Troubled Assets Relief Program (TARP) to comply with hiring rules set for "H-1B dependent" firms -- those with more than 15% of their workers on visas. Those rules set a number of strict requirements for hiring H-1B holders, including a need for companies to attest that they actively recruited American workers and are not displacing or replacing U.S. citizens with foreign workers.

However, the impact of the new legislation on offshoring of IT work may be limited. , an assistant professor of public policy at Rochester Institute of Technology and co-author of the book Outsourcing America, claimed that many TARP-recipient banks "have huge shadow workforces -- people who work for the bank indirectly through outsourcing contract firms."

The TARP-related hiring provision "will rectify some of the indefensible practices of quasi-nationalized banks," Hira said. "But unfortunately, it doesn't close the loopholes where most of the abuse occurs."

Hira said the amount of has actually increased since the bailout program began last fall, citing deals such as offshore outsourcer Tata Consultancy Services Ltd.'s October agreement a unit of . that does business process outsourcing and IT services work. Similarly, Wipro Ltd. agreed in December to buy .

In addition, Hira contended that "many, if not all, of these banks have human resource practices where they force their American workers to train foreign replacements, and subsequently lay off the American workers." That practice "sometimes results in tragedy," he added, citing the 2003 suicide of a former Bank of America Corp. programmer who reportedly was laid off .