U.S. Probe Examines Classification of Infosys Employees Holding H-1B Visas
Key Facts
The U.S. Department of Justice is investigating how Infosys classified certain employees holding H-1B visas in immigration documents submitted to U.S. government agencies, according to the company’s interim financial statements for the quarter and half year ended September 30, 2026. The investigation concerns the immigration documents and the classification they contain, according to the disclosure. The company said it is in discussions with the department about the ongoing investigation and is continuing its internal inquiry into the matter. It said it cannot predict the outcome of the investigation at this stage. It also said it cannot determine whether the outcome could have a material adverse effect on its business and results of operations.
The interim disclosure is part of a series of earlier company disclosures about the case, rather than its initial announcement. Infosys’ annual report for the financial year ended March 31, 2026, said the Justice Department was investigating the same classification. The earlier annual report said the employees concerned were working for one of the company’s clients, while the more recent interim disclosure does not include those details. This establishes that the investigation predated the statements published for the period ended in September. The interim statements provided no further details about the classification under review.
The company is also facing a separate U.S. action involving the permanent labor certification program known as PERM. The Department of Labor announced a suspension of new and pending applications for several companies, including Infosys, under the program. The company said it does not expect the suspension to have a material impact on the enterprise. The action concerns the permanent labor certification process, while the Justice Department’s investigation focuses on the classification of H-1B visa holders in immigration documents. Labor Secretary Keith Sonderling said the suspension also covers Cognizant, Tata Consultancy Services, Wipro, HCL Technologies and Capgemini.
The investigation is taking place as Infosys contends with weaker revenue growth expectations for fiscal 2027. In October, the company cut its revenue growth forecast to 1%-2%, according to the headline of an EL7 report related to its results. In its latest earnings announcement, CEO Salil Parekh said AI revenue accounted for 10.5% of revenue and grew 29% quarter over quarter. The company’s financial context combines a lower growth forecast with expanding AI revenue. Infosys shares, listed under the ticker INFY, closed at $12.11 on October 27, 2026, according to EL7 data.
The report pointed to broader market pressures, so the share price movement alone does not reflect the impact of the investigation. The company also has a separate historical civil settlement: in 2013, Infosys Corporation agreed to pay $34 million to settle allegations of visa fraud and abuse of immigration procedures. That settlement does not establish a connection to the current case. As for the current investigation, the company says its discussions with the Justice Department and its internal inquiry are ongoing, without specifying an expected outcome or potential financial impact.