The Trump administration has suspended Microsoft from the federal program used by employers to seek permanent residency for foreign workers, with Vice President JD Vance accusing the technology giant of misusing the H-1B visa system.
The move, announced Thursday, October 8, comes as the administration expands its crackdown on alleged fraud and abuse involving employment-based immigration programs. The Labor Department said the suspension also applies to Adobe and several major IT services companies, including Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL Technologies and Capgemini.
Vance targets Microsoft over layoffs, H-1B visas
Vance said Microsoft had laid off about 6,000 American workers while obtaining what he described as 6,300 H-1B visas and nearly 3,000 green cards.
“There has been no company in the United States, unfortunately, that has abused the system more than Microsoft,” Vance said during a White House event.
He accused the company of using foreign workers to replace American employees and said the administration wanted technology companies to continue investing and expanding in the United States while prioritizing American workers.
“Our message to Microsoft is: You’re a great American company, but you’ve got to hire great American workers,” Vance said. Vance also described H-1B workers as “foreign indentured servants” while arguing that companies should not lay off U.S. workers and replace them with foreign employees.
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The administration’s figures and characterization of Microsoft’s hiring practices are part of its allegations against the company. Microsoft did not immediately respond to requests for comment, according to Reuters.
What the PERM suspension means
The Permanent Labor Certification, or PERM, process is a key step in the employment-based green card system. Under the process, employers generally must demonstrate to the Labor Department that hiring a foreign worker will not adversely affect the wages, working conditions or job opportunities of U.S. workers.
Once a PERM application is approved, the employer can proceed with the next stages of the employment-based permanent residency process. Labor Secretary Keith Sonderling said the department would not accept new or process pending PERM applications involving the companies covered by the suspension.
The action does not appear to directly cancel the H-1B status of workers already holding those visas. Instead, it can disrupt their employer-sponsored path to permanent residency.
Reuters reported that Microsoft is the largest filer of PERM applications, based on data compiled by Permtrack.app. Microsoft was also among the largest employers of approved H-1B beneficiaries in fiscal 2026, according to U.S. Citizenship and Immigration Services data cited by Reuters.
Indian IT companies also affected
The administration’s action extends beyond Microsoft and Adobe.
Sonderling said Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL Technologies and Capgemini would also be suspended from the PERM process. The companies are among the major users of the H-1B system, particularly in the technology and IT services sectors. Reuters reported that Infosys, TCS, Wipro and HCL have long been among the biggest users of H-1B visas.
The suspension could therefore affect foreign technology professionals who are working in the United States and whose employers are pursuing permanent residency for them. Tata Consultancy Services declined to comment, while the other named companies did not immediately respond to Reuters requests for comment.
Universities face J-1 visa investigations
The administration also announced investigations into nine universities over alleged misuse of J-1 exchange visitor visas.
The universities include Harvard, Yale, Stanford, Brown and the Massachusetts Institute of Technology. Vance accused the institutions of using exchange-visitor visas to bring international students into positions in ways that could undercut American wages.
READ: ‘America for Americans’: Nalin Haley demands end to H-1B visas and legal immigration (September 26, 2026)
Labor Department Inspector General Anthony D’Esposito said it had already served subpoenas. The administration said the investigations would examine whether foreign influence, financial relationships or visa-related practices were affecting federally funded research.
The actions against Microsoft and other companies come after the administration’s earlier efforts to tighten H-1B rules, including a $100,000 fee on certain new H-1B petitions and the Labor Department’s Project Firewall enforcement initiative.
The latest move puts major technology companies and IT services firms under additional scrutiny and could disrupt the permanent residency plans of thousands of foreign workers.