Microsoft is defending its use of employment-based visas following Vice President JD Vance’s accusation that major tech firms are “firing American workers” while simultaneously hiring foreign labor through the H-1B visa program.
The comments came during a high-profile policy forum in Washington, where Vance cited Microsoft’s recent layoff of 9,000 employees as a case in point. Though he did not mention the company by name, the allusion was clear—and sparked a swift and direct response from Redmond.
“I don’t want companies to fire 9,000 American workers and then to go and say, ‘We can’t find workers here in America.’ That’s a bull—- story,” Vance said.
In response, Microsoft said the job eliminations had no connection to its visa program. A spokesperson clarified that roughly 78 percent of the company’s H-1B filings this year were extensions for existing employees, not new hires, and that many visa holders were among those impacted by the layoffs.
Inside the Numbers
According to Labor Department records, Microsoft filed approximately 4,712 H-1B Labor Condition Applications (LCAs) in fiscal year 2025—all certified. From fiscal years 2022 to 2024, it submitted nearly 28,900 H-1B LCAs and approximately 6,900 PERM labor certifications for green card sponsorships. These filings make Microsoft one of the largest and most consistent users of the employment-based immigration system, particularly for roles in software development, artificial intelligence, and cloud engineering.
Contrary to public perception, companies like Microsoft and other Fortune 500 firms generally pay high salaries to H-1B workers—often exceeding the prevailing wage levels mandated by law—especially when hiring talent directly. The issue of wage undercutting more frequently arises when large companies procure H-1B labor indirectly, through subcontractors or third-party consulting firms. In such cases, the subcontracting agencies may take a substantial portion of the hourly billing rate, leaving the H-1B worker with a significantly reduced salary despite working on the same projects.
Yet Microsoft itself, like many of its Fortune 500 peers, is known for strict compliance with wage laws. These companies rarely face Department of Labor (DOL) scrutiny or enforcement actions related to prevailing wage violations. The same cannot be said for smaller outsourcing firms or staffing agencies, some of which have been cited for underpayment and benching violations—practices prohibited under H-1B regulations.
CEO’s Memo: “The Enigma of Success”
Internally, Microsoft leadership has sought to assure employees that the layoffs are part of a broader industry cycle rather than a reflection of company performance. In a memo to staff, CEO Satya Nadella described the job cuts as “the enigma of success in an industry that has no franchise value,” citing rapid innovation and shifting business models as forces requiring continual reinvention—even amid profitability.
The memo, which emphasized Microsoft’s growing investments in AI infrastructure, met with mixed reactions among employees and industry observers, some of whom described the tone as disconnected from the lived reality of those impacted.
The Real Story: L-1 Visas Fly Under the Radar
While the H-1B visa frequently takes center stage in political discourse, immigration attorneys and policy analysts point out that the true blind spot in the employment-based visa system may be the L-1 visa category—used for intra-company transfers.
The L-1A and L-1B visas allow multinational companies to transfer executives, managers, and specialized knowledge workers to the U.S. without undergoing the Department of Labor’s prevailing wage process. For large firms with L-1 blanket approvals, the process is even more streamlined: no petition needs to be filed with USCIS for each individual transfer, and thousands of employees can enter the U.S. based on a single blanket authorization.
“There is no prevailing wage requirement for L-1s,” said one industry expert. “And unlike H-1Bs, which are capped and tracked through public data, L-1s fly almost completely under the radar—there’s no accessible public database detailing how many L-1 workers are brought in each year or what they’re paid.”
Critics argue that this visa category, not H-1B, represents the greater threat to U.S. workers in the IT sector. Yet few politicians raise concerns about L-1 usage—possibly due to the quiet, business-to-business nature of the visa, which lacks the paper trail and controversy surrounding the H-1B program.
Broader Implications
Even as Microsoft insists its visa use is legally compliant and focused on talent retention, the scrutiny is unlikely to fade. Vance’s remarks—echoed by figures like Steve Bannon, who called for the complete elimination of work visas—are part of a broader push to reframe the immigration debate around worker displacement and offshoring.
But analysts caution that targeting H-1Bs may distract from more systemic trends, including the global redistribution of IT services and the rise of L-1-enabled internal outsourcing by multinational firms.
“Time and again, it’s the H-1B program that comes under the political spotlight,” said one immigration lawyer. “But if the goal is to protect U.S. IT workers, then the L-1 visa—and its lack of transparency or wage controls—needs to be part of the conversation.”
As lawmakers prepare to revisit employment-based immigration policy later this year, tech companies may find themselves at the center of an increasingly complex—and politically charged—debate about how the United States balances labor needs, economic competitiveness, and domestic workforce protection.
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