Published: October 8, 2026 · Last updated: October 8, 2026
TL;DR: Vice President JD Vance announced Thursday that the federal government is suspending eight companies, Microsoft, Adobe, Infosys, Tata Consultancy Services, Wipro, HCL, Cognizant and Capgemini, from PERM, the Labor Department process that’s the first legal step toward sponsoring a foreign worker for a green card. The move follows a joint Department of Labor and Department of Justice review of H-1B and J-1 visa fraud. Vance called out Microsoft by name and tied the suspension to the company’s recent layoffs of thousands of American workers, arguing it kept sponsoring foreign hires while cutting domestic jobs. Microsoft says the two have nothing to do with each other. None of the eight firms has been charged with a crime, and the administration hasn’t said how long the suspension will run.
PERM stands for the Program Electronic Review Management system, the Labor Department’s process for certifying that no qualified American worker is available before an employer can sponsor a foreign employee, usually someone already on an H-1B visa, for a green card. It’s a bureaucratic step most people never hear about, but it’s the gate every company has to pass through to turn a temporary work visa into permanent residency. Losing access to it, even temporarily, means a company can’t file new sponsorship cases while the suspension lasts. Vance announced the move alongside findings from the Labor and Justice Departments, framing it as the opening move in a wider crackdown on what the administration calls systemic H-1B and J-1 visa abuse.
Microsoft got the sharpest words. Vance pointed to the company’s recent round of job cuts, which reporting has put at around 9,000 US positions this year including roughly 1,600 at Xbox, and argued Microsoft kept filing visa paperwork for foreign workers at the same time it was letting Americans go. Microsoft pushed back hard, telling reporters its H-1B sponsorship and its layoffs are “in no way” related and that the two processes run on entirely separate timelines and business justifications. That’s a fight over optics as much as law. Nothing in what’s public so far shows a direct swap of one worker for another, but the timing, layoffs becoming national news just as the administration was building its case, gave Vance a much easier story to tell than a dry PERM compliance filing would have on its own.
The other seven names split into two groups. Adobe is the only other US-headquartered software company on the list, and its inclusion is the bigger surprise, since it hasn’t faced the kind of sustained visa criticism that’s followed the IT services firms for years. Infosys, Tata Consultancy Services, Wipro, HCL, Cognizant and Capgemini are exactly the companies labor advocates have spent two decades calling “body shops,” firms that bring in large numbers of H-1B workers on contract, then place them at client companies across the US. Getting named in a fraud sweep isn’t new territory for that group. What’s new is Microsoft and Adobe sitting on the same list, which is what turned a familiar enforcement story into one with Big Tech’s name attached to it.
This isn’t the administration’s first swing at skilled-worker visas this year, and it’s unlikely to be the last. The Trump administration has already raised H-1B filing fees and tightened scrutiny on renewal petitions, and immigration lawyers expect at least some of these eight companies to challenge the suspension in court rather than wait it out. The government hasn’t published the specific fraud findings tied to each company, just the Labor and Justice Departments’ general conclusions, so it’s still not clear whether this is eight companies caught doing the same thing or eight companies swept into one announcement for political effect. Both can be true. An administrative suspension isn’t a conviction, and the gap between “under investigation” and “guilty of fraud” is exactly where this story will get argued out over the next few months.
Related: Microsoft held its biggest Windows and Surface event in two years just last week, a reminder of how much the company still has riding on products built by the same global workforce now caught up in this fight, and California’s new No Robo Bosses Act shows the same tension playing out from a different angle, lawmakers trying to put limits around how tech employers manage the people who work for them.
Bottom Line: Eight companies losing PERM access on the same day is a real story, not a routine compliance footnote, and Microsoft getting grouped with the IT outsourcing firms it usually gets compared favorably against is the part worth watching. But a suspension announced at a press conference and a fraud case that holds up in court are two different things. Until the Labor and Justice Departments release what they actually found on each company, this is a political win for the administration first and a legal one second.
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