The U.S. Department of Labor (DOL) suspended Microsoft, Adobe and six information technology (IT) outsourcing firms from the Permanent Labor Certification (PERM) program on Thursday, Oct. 8 [1][2].
Labor Secretary Keith Sonderling said Microsoft and Adobe were suspended "due to multiple active federal investigations" [2]. Vice President J.D. Vance announced the suspension at a White House news conference, accusing the companies of abusing the visa system [3][4].
The suspension is indefinite, and the DOL said it will not accept new or process pending permanent labor certification applications for the affected companies [5]. The administration also said it served subpoenas and opened investigations at nine universities over alleged misuse of J-1 exchange-visitor visas [5]. Microsoft did not immediately respond to a request for comment [6].
What the Suspension Covers
PERM is the certification process through which an employer must demonstrate that no qualified American worker is available for a position and that hiring a foreign national will not hurt U.S. workers' wages or working conditions [7][8]. The program is typically the first step in obtaining an employer-sponsored green card [9]. The DOL action stops the affected firms from participating in that certification process for new and pending applications [1].
The suspension does not cancel existing H-1B visas and does not invalidate green cards already issued [10][11]. The H-1B program itself is unaffected [11]. The action freezes a key step in employer-sponsored green cards and could disrupt affected workers' pending applications [10].
The DOL did not provide a complete breakdown of every affected job category or worksite in the initial announcement. An explainer by Reuters described the move as the suspension of some of the world's biggest tech and IT firms from the program [12].
Companies Named in the Action
The eight companies named in the suspension are Microsoft, Adobe and six IT outsourcing firms: Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL Technologies and Capgemini [13][14][15]. Microsoft is the largest filer of PERM applications, according to DOL data [8]. The companies had not issued immediate public statements in the initial coverage.
Microsoft owns hundreds of companies including LinkedIn, Skype and gaming studio Activision Blizzard [9]. Reuters reported that the suspension of Microsoft, major IT outsourcers and Adobe came while the administration opened probes into nine top universities [16].
Government Rationale and Program Rules
Vance said the administration wants companies to prioritize American workers [17]. "Our message to Microsoft is: You're a great American company, but you've got to hire great American workers," Vance said at a news conference on Thursday, Reuters reported [18].
He accused Microsoft of laying off 6,000 American workers in 2025 while being approved for more than 6,000 H-1B visas and filing 3,682 PERM applications, nearly 1,000 matching laid-off workers' jobs [19]. Vance also called foreign workers "indentured servants" while announcing the suspension [20][21]. But the Indian Ministry of External Affairs said in a statement on Friday, Oct. 9, that "resorting to terminology that carries painful historical and colonial legacy connotations is deeply offensive" [20].
The PERM program is intended to ensure that U.S. workers are not displaced by foreign labor. Axios reported that the program allows a company to hire foreign workers to live permanently in America [9]. Vance also said the administration is investigating the abuse of J-1 visas by universities [21].
Industry and Political Context
The action comes amid ongoing debate over H-1B visas, green cards and the technology industry's use of foreign labor. The decision has sparked debate over the Microsoft H-1B visa program and the hiring of foreign employees by major technology firms [17]. Critics have argued that such programs can be used to import lower-cost workers, while supporters say they fill specialized labor gaps.
The suspension follows broader scrutiny of how companies use visa and green card pathways. The Trump administration said it is widening a crackdown that targets fraud and protects American jobs [8]. CNBC reported that the action comes as the administration continues to take aim at immigration and foreign hiring programs ahead of November's midterm elections [2].
Several major U.S. tech companies – including Google, Apple and Microsoft – had warned foreign-national employees holding H-1B visas against traveling outside the country amid the administration's immigration clampdown, Business Insider reported [22]. The H-1B visa allows foreign nationals to work in specialty occupations in the U.S. and is typically issued for up to three years, with extensions requiring visa stamping at U.S. embassies or consulates abroad [22].
What Happens Next
The suspension's duration and the conditions for reinstatement were not fully detailed in the initial announcement. Sonderling said the Labor Department will not accept or process any new applications for the affected companies [2]. Affected firms may need to address compliance issues before returning to the program.
References
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