Vice President JD Vance, who chairs the White House Task Force to Eliminate Fraud, announced the PERM suspensions on October 8, 2026. Official White House portrait (public domain).
The Labor Department’s PERM suspension shuts the first gate of the employment-based green card at some of the country’s largest employers of skilled foreign workers. Here is what it changes, what it doesn’t, and what the people waiting in line should do next.
The U.S. Department of Labor on Thursday suspended Microsoft, Adobe and six of the world’s largest IT outsourcing firms (Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL and Capgemini) from the PERM labor certification program, the first step most foreign professionals must clear before an employer can sponsor them for a green card. At the same White House event, Vice President JD Vance and the department’s inspector general said subpoenas had been served on nine universities, including Harvard, MIT and Stanford, in an investigation of how they use J-1 exchange visas to staff federally funded research.
Labor Secretary Keith Sonderling said the department “will not accept any new or process any pending” labor certification applications involving the eight companies, citing “multiple active federal investigations.” Vance, who chairs the White House Task Force to Eliminate Fraud, presented the move as a response to employers that lay off Americans while sponsoring foreign workers. Asked how long the suspension would last, he said: “as long as it needs to.”
Why this matters now. No one’s visa was cancelled on Thursday. But for tens of thousands of H-1B workers at these companies, many of them Indian nationals already facing green-card waits measured in decades, the PERM stage is the gate that keeps a family’s long-term plans moving. Freezing it stops the clock for workers approaching the six-year H-1B limit and changes the math for every employer that still sponsors. It also appears to be the first time the government has used its fraud-suspension power against household-name employers rather than small firms. The announcement came 26 days before the November 3 midterm elections.
The key facts
- Who is suspended: Microsoft, Adobe, Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL and Capgemini.
- What stops: DOL will not accept new PERM applications from these employers or process pending ones.
- What was not announced: No cancellation of existing H-1B status, and no stated change to H-1B petitions, approved I-140 petitions or green cards already issued.
- Likely legal basis: Officials did not cite a regulation. DOL’s rule at 20 CFR 656.31(b) lets it suspend processing during a fraud investigation for up to 180 days at first, and longer if needed.
- Universities under investigation: Harvard, Yale, Stanford, Brown, the University of Pittsburgh, UC Davis, Caltech, Arizona State and MIT. No change to any individual’s J-1 status was announced.
- Company response: Microsoft and Adobe had not publicly commented as of publication.
Why the government went after PERM, not the H-1B itself
To see why this hurts, look at how a foreign professional actually gets a green card. The H-1B is a temporary work visa, capped at six years in most cases. For anyone who wants to stay, the employer usually starts a three-stage process: a PERM labor certification from the Labor Department, then an I-140 immigrant petition at U.S. Citizenship and Immigration Services, then the green card itself, once the worker’s place in line (the “priority date”) becomes current.
PERM is the stage where the employer has to prove something. It must get a prevailing-wage determination, run a prescribed recruitment campaign (including two Sunday newspaper ads, a 30-day state job order and, for professional roles, three more recruitment steps) and attest that no able, willing, qualified and available U.S. worker applied. Vance called this a game in which companies “put an advertisement in a small town newspaper” and then point to the silence. Those ads are not optional. DOL’s own rules require them, and immigration lawyers have long described the newspaper requirement as an outdated formality.
The program is large, and it was already slow. In fiscal 2025, DOL received 117,849 PERM applications and certified 138,093, according to its FY2025 Q4 statistics. Software developers alone accounted for 31,415 certifications, or 22.7%. At the end of September 2025, 157,669 cases were waiting. As of October 5, 2026, analysts were working on applications filed in December 2025, and the average analyst review in August took 336 days. A worker at one of the suspended companies whose case is pending has likely waited close to a year already. That wait now has no end date.
A rarely used power, aimed at an unusual target
The officials did not name their legal authority. The most likely one is 20 CFR 656.31. It lets DOL refer suspected fraud to its inspector general and “suspend processing of any permanent labor certification application” tied to the employer under investigation. A first suspension can last up to 180 days. After that, if there is no indictment, DOL’s national certifying officer can resume processing or extend the freeze until the matter is resolved. The employer must get written notice unless investigators ask otherwise.
The same rule also allows something harsher: debarment of up to three years for willfully false information or a pattern of noncompliance. That requires a detailed written notice and comes with appeal rights. Thursday’s action was described as a suspension, not a debarment.
That distinction may matter more than it seems. Suspension is meant as an investigative pause, not a penalty. Vance described it differently: “We’re punishing them because we want them to change their behavior.” If any of the companies goes to court, expect that sentence to be quoted back to the government.
Practitioners have generally seen 656.31 used against small employers. Applying it across the board to one of the world’s most valuable companies and the backbone of India’s IT services industry is new territory.
The fraud case, and how its numbers hold up
The administration’s legal theory is that the companies made false certifications, not that they used a legal pathway the government now dislikes. A reporter asked Vance exactly that. His answer: “No, we don’t think it was a legal pathway through the system.” Whether that holds will depend on evidence the government has not yet made public. Some of what was said at the podium can be checked now.
“6,300 H-1B visas.” Vance said Microsoft “benefited from 6,300 H-1B visas” in the same year it laid off 6,000 Americans. USCIS data for fiscal 2025, compiled by the National Foundation for American Policy, shows 6,257 approvals for Microsoft, so the figure matches. But only 1,394 of those were approvals for initial employment. The other 4,863 were continuing-employment approvals: extensions, amendments and transfers, mostly for people already working in the U.S. Comparing the full 6,300 with 6,000 layoffs overstates how many new foreign hires there were.
Most H-1B approvals at the suspended companies were renewals, not new hires
| Employer | New employment (initial) | Continuing (extensions, amendments, transfers) | Total | Share new |
|---|---|---|---|---|
| Amazon (not suspended) | 4,644 | 14,532 | 19,176 | 24% |
| Microsoft | 1,394 | 4,863 | 6,257 | 22% |
| Tata Consultancy Services | 846 | 5,293 | 6,139 | 14% |
| Cognizant | 743 | 3,622 | 4,365 | 17% |
| Infosys | 263 | 2,634 | 2,897 | 9% |
| HCL America | 379 | 1,877 | 2,256 | 17% |
| Capgemini | 401 | 1,785 | 2,186 | 18% |
| Wipro | 267 | 1,573 | 1,840 | 15% |
“6,000 layoffs.” Microsoft announced about 6,000 job cuts in May 2025 and about 9,000 more in July 2025, worldwide. Vance’s number lines up with the first round. Microsoft has not published how many cuts fell in the U.S. or which occupations were affected.
The layoff rule is the allegation to watch. PERM regulations at 20 CFR 656.17(k) already address this situation. If an employer laid off workers in the same or a related occupation, in the same area, within six months before filing, it must notify and consider those workers. Business Today reported the administration’s claim that Microsoft filed 3,682 PERM applications, nearly 1,000 of them for positions matching laid-off roles. If investigators can show filings where laid-off Americans were not properly considered, that is a concrete regulatory violation. It is a much stronger case than the raw ratio of visas to layoffs.
“Hyperspecialized” workers. Vance said employers certify that the worker has a “hyperspecialized, hyper capable skill set.” That is close to, but not the same as, the law. The H-1B statute (INA 214(i)) requires a “specialty occupation” involving “highly specialized knowledge” and a bachelor’s degree in a specific field. It says nothing about genius. PERM requires no special skill at all. It tests whether U.S. workers are available. EB-3 green cards cover skilled and even unskilled roles: DOL certified 6,167 PERM cases for meat, poultry and fish cutters in fiscal 2025. If prosecutors try to argue that ordinary professionals cannot lawfully be sponsored, they will run into the text of the statute.
The wage gap. Vance said H-1B workers earn $20,000 less than Americans in the same role, and $48,000 less when hired through outsourcing firms. He gave no source. The law requires H-1B employers to pay the higher of the actual wage or the prevailing wage. The long-running dispute is over whether DOL’s entry-level prevailing wages sit well below the market. Studies on that question point in different directions.
There is precedent for PERM enforcement against Big Tech. In 2021, Facebook agreed to pay up to $14.25 million to settle DOJ and DOL claims that it channeled jobs to visa holders through PERM recruitment designed to discourage U.S. applicants. In November 2023, Apple settled similar claims for up to $25 million, at the time the largest such settlement. Neither company was suspended from the program. The difference this time is the remedy, not the theory.
The outsourcing firms: a long-running fight reaches a new stage
For the six IT services firms, Thursday’s action continues 15 years of friction with Washington. Infosys paid $34 million in 2013 to settle federal claims over its visa practices. In 2024, a California federal jury in Palmer v. Cognizant found that Cognizant intentionally discriminated against non-Indian workers. Vance argued at the podium that outsourcing firms are “as complicit or maybe more so complicit” in visa abuse than the companies that hire them.
The firms’ reliance on new H-1B workers was already falling. In fiscal 2025, Tata Consultancy Services had 846 initial-employment approvals and Infosys had 263, small numbers compared with their peaks of the mid-2010s. The administration’s $100,000 charge on certain new H-1B petitions, imposed by presidential proclamation in September 2025, raised the cost further. A federal court ruled that fee unlawful in June 2026 in a case brought by a coalition of states, and in July the First Circuit refused to let the government keep collecting it while the appeal proceeds. In August, DHS proposed a $103,265 fee on H-1B cap-subject petitions through formal rulemaking. Comments closed September 24, and no effective date has been set.
The PERM freeze therefore hits these firms’ existing U.S. workforce more than their hiring pipeline: the engineers they placed at banks, insurers and retailers years ago who were counting on a green card. Many of those workers are Indian nationals in the EB-2 and EB-3 backlogs, where waits already run longer than a decade. For them, the suspension adds to a delay they could already measure in years.
The universities: a J-1 inquiry with a national-security edge
The second announcement may turn out to be the more important one over time. Labor Department Inspector General Anthony D’Esposito said subpoenas have been served on nine institutions: Harvard, Yale, Stanford, Brown, the University of Pittsburgh, UC Davis, Caltech, Arizona State and MIT. The investigation covers whether they “improperly used J-1 visa classifications to avoid employment obligations,” misused taxpayer-funded programs, or exposed federally funded research to foreign influence, particularly from China.
How the J-1 differs from the H-1B. The J-1 research scholar and professor categories belong to the State Department’s exchange visitor program. The university issues the paperwork (Form DS-2019), and unlike the H-1B, there is no Labor Department wage requirement. A university that hires a postdoc on an H-1B, even a cap-exempt one, must file a labor condition application and pay at least the prevailing wage. A J-1 hire has no such floor. That structural difference helps explain the roughly $20,000 pay gap Vance described. Whether using the cheaper category is unlawful, or simply a choice Congress allowed, is the central legal question.
The numbers need care. Vance said the nine schools use J-1 visas for federally funded grants at a rate of about 61%, compared with a national average of 38%. D’Esposito stated it differently: “approximately 61%” of postdoctoral researchers and federally funded workers at these institutions “are foreign nationals.” Those are two different measurements, and neither source has published its method. For scale, the Institute of International Education’s Open Doors survey counted 116,540 international scholars at U.S. institutions in 2024/25, up 4%. Of those, 78% work in STEM fields. China (25,983) and India (19,156) are the largest sources.
A jurisdiction question. The J-1 is not a Labor Department program, so DOL’s inspector general will likely rest its authority on federal grant money and employment law. Expect the universities to test that. Also keep in mind that many J-1 researchers are subject to the two-year home-residency requirement (INA 212(e)). That makes it hard for a university to simply move them to H-1B status without a waiver.
The probe adds to pressure on international talent in higher education. On October 8, DHS published a proposed rule that would charge schools $70,000 per student for initial Optional Practical Training (OPT) and $30,000 for each later OPT period, including STEM extensions. Schools could pass the cost on to students or employers. Public comments are open through November 9, 2026.
Your questions, answered
These answers reflect what officials said on October 8 and the rules in force. As of publication, DOL had not issued written guidance and USCIS had said nothing. Treat this as general information and check your own case with an immigration attorney.
I work at Microsoft, Adobe or one of the six IT firms on an H-1B. Is my visa cancelled?
No. Nothing announced on Thursday revokes H-1B status or stops H-1B extensions or transfers. The suspension covers the PERM labor certification step only. You can keep working, travel under your existing visa stamp, and file extensions as normal.
My PERM application is pending. What happens to it?
According to Secretary Sonderling, DOL will not process it while the suspension lasts. It is not denied, only frozen. Under DOL’s rules, a first suspension can last up to 180 days and can then be extended or lifted. If the investigation finds no fraud, pending cases are to be decided “on the merits.” If fraud is found, DOL may deny them. Do not withdraw the case unless your lawyer advises it. A pending application may still help you with H-1B extensions (see below).
My PERM was certified, but my I-140 hasn’t been filed yet.
A certified PERM must be used to file an I-140 within 180 days (20 CFR 656.30). The announcement covers DOL processing, and USCIS has not said it will refuse I-140s based on certifications already issued. DOL can still revoke certifications it finds were improperly granted (20 CFR 656.32). Ask your employer’s counsel whether to file now rather than wait.
My I-140 is already approved. Am I safe?
You are past the PERM stage, so the suspension does not affect you directly. You keep your priority date even if you change employers. The exception is an I-140 revoked for fraud, willful misrepresentation or material error (8 CFR 204.5(e)(2)), so the outcome of the investigation still matters. Once an I-140 has been approved for 180 days or more, an employer withdrawing it does not, on its own, cancel your priority date or your eligibility for extensions.
My I-485 green card application is pending.
If it has been pending for 180 days or more, AC21 portability (INA 204(j)) lets you move to a “same or similar” job with another employer without starting over. If it has been pending for less, waiting is usually the safer course. Talk to counsel before changing jobs.
I’m in year five or six of my H-1B. Can I still extend?
It depends on what is already on file.
- PERM or I-140 filed at least 365 days before your six-year limit: You can generally get one-year extensions under AC21 section 106(a) as long as the case is not denied. A suspended PERM is not a denial, but USCIS has not yet said so explicitly.
- Approved I-140 and a backlogged priority date (common for Indian and Chinese nationals): Three-year extensions under section 104(c) remain available.
- No PERM on file yet: This is the most exposed group. Your employer cannot start a PERM case while suspended, so you could hit the six-year limit. Your realistic options are a new employer that starts PERM promptly, a change of status, or time abroad that resets the H-1B clock.
Should I switch employers? Will I lose my place in line?
If your I-140 is approved, your priority date generally moves with you. Your new employer will have to run a fresh PERM case. At current processing times (a wage determination, recruitment, then about 11 months of analyst review) that is realistically 18 to 24 months before a new I-140 is approved. Switching makes the most sense for workers with no approved I-140 and limited H-1B time left.
My spouse has an H-4 work permit (EAD).
H-4 EAD eligibility comes from the principal worker having an approved I-140 or an AC21 extension. Spouses who already qualify are not affected by the announcement.
I’m placed at Microsoft through a staffing vendor that is not on the list.
PERM is filed by the sponsoring employer. If that employer is not one of the eight named companies, the suspension as announced does not cover your case. Sonderling’s phrase “applications involving these companies” is broad enough that clarification is needed, and contractors should expect closer scrutiny.
I have a job offer from one of these companies. Should I accept?
If a green card is part of your plan, ask in writing how the company will handle sponsorship during the suspension. Consider negotiating for the employer to start PERM as soon as the freeze lifts. A competitor that can still sponsor you now has a real recruiting advantage.
Are Amazon, Google or Meta next?
No other company was named. Amazon, the largest H-1B employer by far, was not mentioned. Vance said the approach “could apply to a number of other technology companies as well,” and Attorney General Todd Blanche said the Justice Department is “actively investigating companies that do this.” Every PERM sponsor should now treat layoffs in the six months before filing as a serious compliance risk.
I’m a J-1 researcher or postdoc at one of the nine universities.
The investigation targets the institutions, not individual exchange visitors. No change to anyone’s J-1 status or DS-2019 was announced. Keep your documents current and follow your international scholars office’s guidance. If you are subject to the two-year home-residency rule and were planning a waiver or a change of status, raise it with counsel early. Universities under subpoena may become more cautious about sponsorship.
I’m an American worker who believes I was passed over for a visa holder. What can I do?
You can file a citizenship-discrimination charge with the Justice Department’s Immigrant and Employee Rights Section, generally within 180 days. You can also contact the EEOC about national-origin discrimination, or report H-1B wage violations to DOL’s Wage and Hour Division. The Facebook and Apple settlements both included back-pay funds for affected U.S. applicants.
How long will the suspension last, and can the companies fight it?
Vance said it will last “as long as it needs to,” and that the goal is changed behavior. In practice there are three likely paths:
- A negotiated settlement: Compliance commitments in exchange for reinstatement, the pattern from the Facebook and Apple cases.
- A court challenge: A suit under the Administrative Procedure Act arguing the suspension is punitive rather than investigative, or lacks a factual basis.
- Escalation: An indictment or a formal debarment of up to three years.
The first 180-day window, if it started this week, would run to about early April 2027.
Analysis: what this signals, and what comes next
The politics are less partisan than they look. Criticism of H-1B outsourcing has never belonged to one party. Senators Chuck Grassley and Dick Durbin have spent years co-sponsoring H-1B and L-1 reform bills. Vance himself invoked Bernie Sanders’s 2016 warning that open borders would hurt American workers. What is new is the method: executive enforcement against named companies instead of legislation. Vance said as much, calling on Congress to act while promising to use “regulatory authorities” in the meantime. Timing matters too. The announcement came weeks before the midterms, and on the same day, a reporter noted, President Trump was set to honor Microsoft’s CEO with a national technology medal. Vance answered that Microsoft is “a Great American company” with which the administration has “a great relationship.”
The two sides will read this very differently. Supporters, including many workers who were asked to train their replacements, will see overdue accountability. Vance and Stephen Miller both returned to that image. Critics in industry and academia will argue that the remedy hits the wrong people: the immigrant engineers whose green cards are frozen are not the ones accused of wrongdoing. They will also warn that work which cannot be staffed here moves to Bangalore, Toronto or Dublin rather than to American job seekers. Both arguments have real evidence behind them, and the outcome will depend on facts the government has not yet released.
Expect quiet changes across the industry. Whatever happens to these eight companies, every large PERM sponsor’s lawyers are now reviewing two things. The first is whether layoffs and labor certification filings overlap in the same occupation and region. The second is whether their recruitment campaigns would hold up to a skeptical investigator. The likely results are fewer PERM filings after layoffs, more documentation, and possibly a quiet pause in sponsorship at companies that are cutting staff. For workers, an employer’s layoff history is now part of the risk in accepting a sponsored job.
For universities, the stakes run beyond immigration. If investigators tie J-1 use to federal grant compliance, the leverage is research funding, not visas. That would change how academic labs hire. It would also open a legal fight over whether the Labor Department’s inspector general can police a State Department exchange program.
What to watch
- Written suspension notices to each company, which DOL’s rule requires unless investigators ask otherwise. They will show the legal basis and the stated scope.
- USCIS guidance on whether suspended PERM cases still support AC21 extensions, and on I-140s filed from certifications already issued.
- Company statements or lawsuits from Microsoft, Adobe and the six IT firms.
- Responses to the university subpoenas, and any move by the nine schools to reduce J-1 sponsorship.
- November 3: Midterm elections.
- November 9: Comment deadline for DHS’s proposed OPT fee.
- Early April 2027: End of a first 180-day suspension window, if it began this week.
- Other named companies: Vance said this “could apply to a number of other technology companies as well.”
Immigration Analytics will update this story as written guidance, company responses and court filings become available. This article is for general information and is not legal advice.
Sources
- Transcript of the October 8, 2026 White House press conference (Vice President Vance, Labor Secretary Sonderling, Attorney General Blanche, Stephen Miller, Labor Inspector General D’Esposito, Andrew Ferguson)
- Setback for IT giants (Business Today)
- 20 CFR 656.31, labor certification fraud, suspension and debarment (eCFR)
- PERM Selected Statistics, FY2025 Q4 (DOL OFLC)
- Processing times (DOL FLAG)
- H-1B Petitions and Denial Rates, FY2025 (NFAP, from USCIS data)
- Open Doors 2025: International Scholars (IIE)
- Jury finds bias in Cognizant’s treatment of non-Indian workers (Staffing Industry Analysts)
- Fee for Certain H-1B Petitions, proposed rule, August 25, 2026 (Federal Register)
- Optional Practical Training Fees, proposed rule, October 8, 2026 (Federal Register)
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