The United States government has moved to exclude some of the world’s top tech companies from a programme that allows them to sponsor skilled foreign workers for permanent residency. Vice President JD Vance said the action was a response to companies abusing the system to hire lower-paid foreign workers at the expense of US workers.
It comes as US President Donald Trump’s administration continues efforts to clamp down on immigration, both legal and undocumented, and make it harder for immigrants to get residency or citizenship. But the latest move also potentially impacts thousands of foreign workers, many of whom have spent years waiting for a backlog in applications to clear.
The suspension concerns the Permanent Labour Certification programme, known as PERM, which enables a US-based employer to sponsor a foreign worker’s green card. To qualify, the employer is supposed to demonstrate that there are insufficient US workers for a needed job role and that bringing a foreign worker will not impact the pay or conditions of US workers in the industry. PERM is a key step in the green card process for many skilled foreign workers, who often start on temporary visas like the H-1B before transitioning to permanent residency.
Speaking at a White House news conference on Thursday, Vance accused major companies of fraudulently using the current visa regime to displace US employees and bring in lower-paid foreign workers who amount to indentured servants. He claimed that many workers who start off on temporary H-1B visas and later apply for permanent residency under the PERM programme are mistreated by their employers and used to undercut American wages. Labour Secretary Keith Sonderling used similar language, stating that the administration would shut down a pipeline of systemic fraud that has flooded the country.
Vance singled out Microsoft as a major offender and announced that the company would be suspended from the PERM programme. Other firms facing suspended applications include US software firm Adobe, alongside major IT providers such as Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL Technologies, and Capgemini. Labour Secretary Sonderling confirmed that the administration will not accept any new applications or process any pending permanent labour certification applications involving these specific companies, adding that the suspensions will remain in place as long as needed. Other heavy users of H-1B visas, such as Meta, Amazon, and Alphabet’s Google, are not affected by this action.
Critics of the H-1B visa and PERM green card process argue that some employers use the system not to fill legitimate skills shortages, but to reduce labour costs and gain leverage over workers. Vance stated that Microsoft laid off 6,000 US workers last year while simultaneously securing 6,300 H-1B visas and nearly 3,000 green cards. Sonderling added that the suspended companies have received more than 230,000 H-1B visas and over 100,000 permanent labour certifications since 2009.
Microsoft disputed the implication that its visa filings represented new hires replacing US workers. In a statement, the company explained that 80 percent of the approximately 6,000 H-1B visa applications it issued last year were to extend or change the status of existing employees rather than onboard new staff, and that the remaining filings were for individuals already legally residing in the United States. Microsoft also noted that it only files applications for people meeting rigorous standards and pays them equally to others doing similar work.
The suspension could make it significantly harder for foreign workers in the tech industry to obtain permanent residency in the US. Many of those affected are likely to be Indian nationals, who account for a large share of the country’s skilled foreign workforce in the technology sector.