California-based Electronics for Imaging paid the workers $1.21 (75p) per hour. They worked 122 hours in a week without overtime pay.
The company said it "unintentionally overlooked" US laws on wages and overtime. California's minimum wage at the time was $8 per hour.
Thousands of Indians work in Silicon Valley and many own start-ups there.
Reports say that Electronics for Imaging, a printing technology firm, has to pay more than $43,000 (Â£26,798) in back wages and penalties after labour regulators discovered the violations.
The eight workers were brought to the US on a special project, at the time when they helped the company move its headquarters from Foster City to Fremont.
Reports say  the firm paid the Indian workers the same wages they received in their normal jobs in the Indian city of Bangalore - and continued to pay them in rupees.
US laws require foreign workers to be paid at least the minimum wage, with overtime for working more than 40 hours a week.
"This is worse than anything that I ever saw in any of those Los Angeles sweatshops," Michael Eastwood, assistant district director of Department of Labour, told the Associated Press news agency.
US labour authorities have penalised a Silicon Valley company for "grossly underpaying" eight workers from India.