Microsoft has lost access to a major immigration pathway. Donald Trump’s administration temporarily banned Microsoft, Adobe, and several other technology companies from sponsoring workers for permanent US residency through the Permanent Labor Certification, or Perm, program.
The US says Microsoft abused immigration rules, while the company disputes the claim. Six IT outsourcing companies—Cognizant, Infosys, Tata, Wipro, HCL, and Capgemini—were also suspended from the program, creating a broad enforcement action around companies with ties to India.
Subpoenas have been served and investigations are under way. Nobody is getting a free pass because their name is carved into an expensive building.
Microsoft challenges the case
Microsoft said the “vast majority” of its employees in the US were American. The company also said its visa applications were largely “to extend or change the status” of existing employees, rather than bring an entirely new workforce into the country.
Microsoft said it files H-1B petitions only for people who meet the rigorous standards of that visa category. It also said its employees receive some of the highest compensation in the technology sector, with wages among the highest in all H-1B filings.
The response follows criticism from JD Vance, who said some H-1B holders earned between $20,000 and $48,000 less than US citizens hired for similar positions. Vance singled out Microsoft, saying it “laid off last year 6,000 American workers at the same time the company benefited from 6,300 H-1B visas and almost 3,000 green cards.”
Vance also delivered the administration’s preferred message directly: “Our message to Microsoft is: ‘You’re a great American company, but you’ve got to hire great American workers.’” Microsoft’s shares dropped more than 1 percent following the announcement.
On Thursday, the Trump administration gave Microsoft’s Indian-born chief executive, Satya Nadella, the National Medal of Technology and Innovation. Vance said there was no contradiction between honoring Nadella and suspending Microsoft from the Perm program.
A wider immigration crackdown
The announcement marks the latest move in the Trump administration’s broad crackdown on immigration. Last year, the White House attempted to impose a $100,000 fee on new applications, but a federal judge ruled that the fee amounted to an unauthorized tax.
Before that proposed increase, the government charged $215 to register for the H-1B visa lottery and a $780 base fee for employers sponsoring visa applicants. More than 400,000 such visas were approved last year, showing the scale of the system now under scrutiny.
The Perm suspension also lands amid a large backlog for Indian workers. Nearly 1 million people from India were waiting for employment-based permanent residency as of December last year, though Nasscom said the number of employees transitioning to permanent residency through Perm was “relatively limited.”
Tata Consultancy Services said its strategy centered on hiring locally in the US, adding that its Perm applications were in “single digits in the last two years.” Adobe and Tata, along with Cognizant, Infosys, Wipro, HCL, and Capgemini, did not respond to requests for comment.
The foreign ministry in New Delhi said “such descriptions are unwarranted and ignore the fact that Indian professionals in the United States are highly educated and skilled contributors to its economy and innovation ecosystem.” That puts the dispute beyond corporate compliance and into the familiar territory of immigration policy, national identity, and who gets counted as an American worker.
The administration has also announced a fraud investigation into the use of J-1 student visas at nine American universities, including Harvard, Yale, and Stanford. The pattern is clear: employment visas, student visas, corporate hiring, and permanent residency are being pulled into the same enforcement campaign.
Microsoft now faces investigations alongside companies that employ large numbers of technology workers across the US. The suspension may be temporary, but it turns a routine immigration process into a direct test of how technology companies recruit, retain, and defend their workforces.
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