In a sweeping enforcement action announced on October 8, 2026, the Trump administration suspended eight major technology companies from the U.S. Department of Labor’s Permanent Labor Certification Program (PERM). The companies include Microsoft, Adobe, Infosys, Tata Consultancy Services (TCS), Wipro, HCL Technologies, Cognizant and Capgemini.

The decision follows allegations that some employers have misused employment-based immigration programmes and displaced American workers. U.S. Vice President JD Vance and Labour Secretary Keith Sonderling announced the move as part of the administration’s broader effort to prioritise American workers and strengthen oversight of foreign-worker hiring.

Impact of the PERM Suspension on Employers and Foreign Workers

• PERM applications on hold: The Department of Labor will not accept new or process pending PERM applications involving the affected companies.
• Potential green card delays: Foreign employees relying on these employers for PERM-based green card sponsorship may face delays in their permanent residency process.
• Existing H-1B status remains separate: The suspension does not automatically cancel existing H-1B status or invalidate a worker’s authorisation to remain employed.
• No blanket H-1B ban: The action concerns the PERM labour certification process. It does not, by itself, prevent affected companies from employing workers who maintain valid H-1B status.
• Possible complications with H-1B extensions: Some employees may face difficulties obtaining extensions beyond the usual six-year H-1B limit if they rely on qualifying green card milestones. The impact will depend on their individual circumstances and eligibility.

The Vice President said the suspension would last ‘as long as it needs to’. 

This suspension comes as DOL is also overhauling the PERM program itself – our guide on DOL’s Planned PERM Labor Certification Overhaul explains what broader structural changes employers should be preparing for.

The Administration’s Allegations Against IT Companies

Labour Secretary Keith Sonderling described the action as a response to what he called “systemic fraud” in employment-based immigration programmes. He said the companies had collectively requested nearly three million foreign workers since 2009. According to figures he presented, they had received more than 230,000 H-1B approvals and over 100,000 permanent labour certifications.

Microsoft was a particular focus of Vance’s criticism. He alleged that the company had laid off approximately 6,000 American workers while benefiting from around 6,300 H-1B visas and nearly 3,000 green cards. He argued that these figures raised concerns about the use of foreign-worker programmes alongside workforce reductions.

Vance said the administration wanted technology companies to continue growing in the U.S. but expected them to prioritise American workers. The allegations remain subject to the relevant investigations and should not be treated as established findings of wrongdoing.

Microsoft Responds to the Allegations

Microsoft said it would provide the administration with additional information and defended its use of the H-1B programme. The company stated that around 80% of the roughly 6,000 H-1B applications it filed in its last fiscal year were for extensions or changes of status involving existing employees rather than new hires.

It added that the remaining filings were for people already legally present in the U.S. who chose to join the company. Microsoft said these employees represented about 1% of its U.S. workforce. It also maintained that it pays H-1B employees comparably to colleagues performing similar work.

Impact on Indian IT Professionals

The suspension could affect Indian professionals seeking employer-sponsored green cards through these IT companies. However, the restrictions do not automatically cancel their existing H-1B status, and there will not be any short-term disruptions to the companies’ operations. However, the retention strategy of these tech companies could be affected in the long term.

NASSCOM, India’s IT industry association, said the decision affects a specific immigration pathway and stressed that skilled talent mobility and permanent immigration are separate issues. It also noted that Indian technology companies have reduced their reliance on H-1B visas while expanding local hiring in the U.S.

Conclusion

The suspension marks a significant development in U.S. employment-based immigration and could affect green card processing for employees of the companies involved. The next steps will depend on further government updates, the outcome of the ongoing investigations, and any potential litigation by these tech companies.

Disclaimer: This article is provided for informational purposes only and does not constitute legal advice. Receipt of this communication does not establish an attorney-client relationship. Please consult with a qualified immigration attorney regarding your specific circumstances.