The United States government has temporarily excluded several major technology companies, including prominent Indian IT firms, from its labour certification programme for foreign workers seeking permanent residency. The move prevents the affected companies from submitting new applications for permanent labour certification, while applications already under consideration will also be put on hold.

According to Indian news agency ANI, US Labour Secretary Keith Sonderling announced the decision on Thursday, alongside Vice-President JD Vance. The companies affected include Cognizant, Infosys, Tata, Wipro and HCL from India, as well as France-based Capgemini and US technology giants Microsoft and Adobe.

The administration argues that some large technology and IT services companies have relied excessively on foreign labour, reducing employment opportunities for American workers. Sonderling said the action targeted several major global IT services providers and that neither new applications involving the companies nor pending applications would be allowed to proceed under the measure.

He claimed that, since 2009, the companies had submitted approximately three million applications related to foreign worker recruitment. They had received more than 230,000 approvals under the H-1B visa programme and more than 100,000 approvals for permanent labour certification.

Sonderling alleged that the recruitment practices of these companies had cost American workers hundreds of thousands of job opportunities. However, the claims reflect the administration’s position, and the report did not provide detailed responses from all the companies concerned.

What the Suspension Means for Green Card Applicants

Permanent labour certification is a key stage in the US employment-based immigration process. Known as PERM, the process generally requires an employer to demonstrate that there are not sufficient available, qualified US workers for the position and that employing a foreign worker will not adversely affect the wages and working conditions of similarly employed American workers.

Once the relevant certification requirements have been met, an employer can generally proceed with an employment-based immigrant petition for an eligible foreign worker. Depending on the worker’s circumstances and the applicable immigration category, this may eventually lead to an application for a US Green Card, which grants lawful permanent resident status.

The suspension could therefore create uncertainty for foreign professionals whose employers rely on this route to secure permanent residency. Pending applications may face delays, while affected companies will have to reconsider their recruitment and immigration plans.

The measure should not, however, be interpreted as an automatic cancellation of all existing work visas or Green Cards held by employees of the companies concerned. The immediate consequences described in the announcement relate to new and pending labour certification applications.

JD Vance Accuses Microsoft of Misusing the H-1B System

Vice-President JD Vance singled out Microsoft for criticism, accusing the company of being among the most prominent users of the H-1B visa system in ways that, he argued, disadvantaged American workers.

According to figures cited by Vance, Microsoft laid off 6,000 American employees in 2025. During the same year, the company received approval for more than 6,000 H-1B visas and submitted 3,682 applications for permanent labour certification.

Vance claimed that approximately 1,000 of those labour certification applications related to positions from which American employees had been laid off.

He also questioned how some employers advertise vacancies before seeking permission to recruit foreign workers. Under applicable US labour certification rules, employers must generally undertake prescribed recruitment efforts to establish whether qualified American workers are available for the positions concerned.

Vance alleged that some companies placed advertisements in newspapers serving smaller communities and subsequently claimed that no suitable American candidates had applied. He argued that such practices could allow employers to meet formal requirements while replacing local workers with foreign recruits.

In particularly forceful language, Vance described foreign employees recruited through the H-1B programme as ‘indentured servants’ and referred to companies using the system as ‘visa factories’. His comments reflect the administration’s criticism of current recruitment practices, rather than an established finding that every company using the programme has violated the law.

Vance said the visa system, which was designed to help employers recruit workers with specialised skills, should not be used to suppress American wages or displace domestic employees.

He also criticised universities employing researchers through the J-1 visa programme. He alleged that some institutions were using the scheme excessively, putting downward pressure on the pay of American postgraduate students and researchers. The report did not provide detailed evidence supporting these allegations or responses from the universities concerned.

Trump Administration Tightens Immigration Policy

The decision comes amid a wider effort by President Donald Trump’s administration to tighten immigration rules and prioritise employment opportunities for American citizens.

The administration has repeatedly argued that some employers recruit skilled workers from India and other South Asian countries because they can do so at a lower cost, potentially disadvantaging US workers. The debate has become particularly prominent in the technology sector, where employers recruit internationally while also restructuring their workforces and reducing staffing in certain areas.

The H-1B visa allows eligible US employers to recruit foreign professionals for jobs requiring specialised knowledge. The programme is widely used in fields such as information technology, engineering, scientific research and other technical occupations.

Indian professionals account for a substantial proportion of H-1B beneficiaries, making changes to the programme particularly significant for India’s technology industry. Many Indian IT companies provide services to US clients, and some deploy employees to work on projects requiring specialised technical expertise.

The administration has also extended the planned duration of a $100,000 fee associated with H-1B temporary worker visas by a further year, according to the report. The precise scope and applicability of such a measure depend on the relevant government rules, including which applications and workers are covered.

Taken together, the changes signal a more restrictive environment for employers seeking to bring foreign professionals to the United States. Companies may need to reassess staffing arrangements, recruitment costs and long-term immigration plans, particularly where employees depend on employer-sponsored pathways to permanent residency.

NASSCOM Defends Indian Technology Companies

India’s technology industry association, NASSCOM, has responded to the US government’s decision by disputing the suggestion that Indian IT companies remain heavily dependent on H-1B visas.

The organisation said Indian technology firms had reduced their reliance on the programme in recent years while increasing the recruitment of local employees in the United States.

In a statement, NASSCOM argued that immigration policy and the movement of skilled professionals between countries should be treated as separate issues. It maintained that temporary access to international expertise serves a different purpose from permanent immigration and should not be assessed as though the two were identical.

The association also emphasised the longstanding role of the H-1B programme in helping US employers address shortages of specialised skills. It argued that the scheme could remain necessary in the future where domestic labour markets are unable to meet demand for particular technical capabilities.

NASSCOM further claimed that Indian technology companies work with most businesses on the US Fortune 500 list. According to the association, these partnerships support innovation, business expansion and the delivery of technology services, while also contributing to employment within the United States.

The organisation’s position challenges the administration’s argument that foreign recruitment necessarily comes at the expense of American workers. It suggests that international technology companies can support US businesses and create local employment while bringing in specialist expertise when needed.

Uncertainty for the Global Technology Industry

The suspension could have consequences beyond the individual companies named in the announcement. Indian IT service providers have extensive commercial relationships with American businesses, ranging from software development and systems management to consulting, cloud services and digital transformation.

If labour certification applications remain stalled, some employees hoping to secure permanent residency may face longer periods of uncertainty. Employers may also have to reconsider where particular projects are staffed, how specialist workers are deployed and whether additional recruitment within the United States is feasible.

Indian technology companies could respond by increasing local hiring, adjusting international staffing arrangements or assigning certain projects to teams based outside the United States. These are possible responses rather than confirmed plans by the companies named in the decision.

The wider issue is how the United States balances domestic employment protection with its demand for skilled professionals. Employers argue that access to international talent can help address specialist shortages and support innovation. Critics contend that inadequate oversight can create opportunities to undercut local wages or disadvantage American workers.

For India, the decision presents a challenge to an industry that has built a substantial part of its international business around providing technology services to US clients. For American companies, the restrictions could complicate the recruitment and retention of employees whose expertise is difficult to source locally.

The eventual impact will depend on how the suspension is implemented, whether the affected companies challenge the decision, and what further guidance the US government provides. Until those details become clearer, both employers and foreign professionals pursuing permanent residency are likely to face greater uncertainty over the future of employment-based immigration in the United States.