Washington suspends permanent residency pathway for 8 tech companies including Microsoft
Key Facts
The United States announced on 8 October 2026 that it was suspending 8 technology companies from the permanent labor certification program, according to a Reuters report, in a move targeting applications to sponsor foreign workers for permanent residency. Labor Secretary Keith Sonderling said the department would stop accepting new applications from the companies covered by the decision. The measure also halts processing of their pending applications, extending the suspension to cases awaiting a decision. The list includes Microsoft, Adobe, Cognizant and Infosys, along with Tata Consultancy Services, Wipro, HCL Technologies and Capgemini. The U.S. administration presented the decision as part of a campaign it says targets fraud and protects American jobs. Microsoft figures prominently among the companies affected, as it is the largest filer of permanent labor certification applications, according to Labor Department data cited by Reuters.
In its response reported by Reuters, Microsoft said about 80% of the specialty occupation visa applications it filed in the fiscal year preceding the announcement were to extend or change the status of existing employees. The company said it pays employees holding these visas wages comparable to those earned by employees performing similar work. The suspension concerns the permanent labor certification pathway and does not revoke existing specialty occupation visas, according to Axios. In trading on the day the decision was announced, Microsoft shares were down 1.7% when Investing.com updated its coverage. Adobe shares, by contrast, rose 1% during the trading covered by the same report. The divergence was between shares of companies both covered by the measure, which halted new and pending applications across the group.
The labor certification pathway requires proof that no American workers are able to fill the position in question, according to the Delaware Department of Labor. The test also requires that these workers be qualified, willing and available to accept the job. The program further requires that hiring the foreign worker not adversely affect the wages of American workers in similar jobs. This protection extends to their working conditions, as well as wages, under the requirements of the pathway to permanent residency. In connection with the investigation into foreign labor fraud, the U.S. Labor Department's Office of Inspector General said investigators had issued dozens of subpoenas. The office added that they had also executed search warrants as part of the investigation.
In a separate case involving enforcement of the program's rules, the U.S. Justice Department announced a settlement with Cloudera that barred it from participating in the permanent labor certification program. The settlement set the ban at 2 years, according to the department's official statement. The settlement agreement also required the company to pay civil penalties of $600000. Those penalties are payable to the U.S. Treasury under the agreement, alongside the restriction on participation in the program. As for Indian technology companies operating in the United States, industry body Nasscom said they had substantially reduced their reliance on specialty occupation visas. Reuters reported the body's position in its coverage of the suspension of the permanent residency pathway for the technology companies.
Infosys, meanwhile, said in an official stock exchange filing that it did not expect the suspension announcement to have a material impact on the organization. The company highlighted its investment in building a local workforce in the United States, as well as technology and innovation centers there. On regulatory follow-up, it said it would make additional disclosures if required by regulatory standards. U.S. Vice President JD Vance did not tie the end of the suspension to a specific date, saying in his remarks on the decision announced on 8 October that it would last "as long as it takes." Vance added that the administration wanted to change the companies' hiring practices, linking the continuation of the measure to the administration's stated objective regarding those practices.