Major tech companies operating in the United States have hit a significant hurdle in facilitating green cards for foreign employees.

The U.S. government has temporarily suspended permanent labor certification programs for several leading IT and software firms, including Infosys, Tata Consultancy Services (TCS), Cognizant, Wipro, HCLTech, Microsoft, Capgemini, and Adobe.

The decision leaves Indian tech workers employed at these firms facing deep uncertainty over their permanent residency prospects, while analysts warn the move could raise hiring costs and legal compliance expenses for the affected companies.

Keith Sonderling, Deputy Secretary of the U.S. Department of Labor, announced the suspension.

Under the ruling, new permanent labor certification applications from these companies will not be accepted, and pending applications have been placed on hold.

However, reports indicate the move does not automatically revoke workers' current temporary employment visas.

This high-stakes development for India's IT sector comes amid U.S. President Donald Trump's broader crackdown on foreign skilled labor and immigration.

On Friday (October 9), India's Ministry of External Affairs criticized the decision, stating that it does not align with the shared objectives of the two nations.

What Is the Permanent Labor Certification Program?
The Permanent Labor Certification program is a crucial prerequisite for obtaining employment-based green cards in the United States.

Under this system, employers must demonstrate that hiring a foreign national will not adversely affect the wages or working conditions of U.S. workers.

The application process is sponsored directly by the employer rather than the individual worker.

Many skilled foreign professionals initially enter the U.S. on H-1B temporary work visas before applying for permanent residency.

Disruptions to the certification process threaten to derail long-term career and settlement plans for these workers.

First streamlined in 2005 to expedite green card processing, the program's suspension means participating companies cannot submit new applications or advance existing ones for the duration of the order.

Vance Accuses Microsoft of Displacing American Workers
U.S. Vice President JD Vance accused certain tech giants of laying off American workers and replacing them with foreign talent.

Vance pointed to Microsoft, alleging that while the company laid off 6,000 U.S. workers last year, it received approval for 6,300 H-1B visas and nearly 3,000 green cards.

However, available reports could not independently verify whether foreign workers directly replaced the laid-off staff.

For its part, Microsoft stated that nearly 80 percent of its H-1B filings in the last fiscal year were for existing employees seeking status extensions or amendments, rather than new hires.

According to Department of Labor data, Microsoft remains one of the largest applicants under the permanent labor certification program.

Anticipated Impact on Indian IT Firms
Analysts suggest the immediate, short-term impact on Indian IT giants may remain manageable.

However, prolonged uncertainty could increase operational costs related to local hiring, legal compliance, and workforce deployment, ultimately squeezing profit margins.

Data from ICICI Securities shows that Indian IT firms accounted for less than two percent of all permanent labor certification applications filed in the U.S. between October 2024 and September 2025.

Nevertheless, heightened green card uncertainty could drive up attrition rates among U.S.-based employees.

Nasscom, India’s premier IT industry association, noted that Indian tech companies have steadily reduced their reliance on H-1B visas in recent years by scaling up local American hiring.

The association added that relatively few workers utilize the permanent labor program to transition from H-1B visas to green cards.

Tata Consultancy Services (TCS), India’s largest IT exporter, expressed confidence that the suspension would not disrupt its recruitment strategies or client deliverables, noting that its filings for permanent labor certifications over the past two years have been minimal.

Trump Administration’s Hardline Stance
The Trump administration has intensified scrutiny over alleged abuses in the H-1B visa and permanent labor certification systems, targeting wage suppression and fraudulent applications.

In September last year, the Department of Labor launched an enforcement initiative titled "Project Firewall." That same month, officials announced a one-time $100,000 fee on new H-1B applications filed for overseas hires.

The latest move follows the suspension of Cognizant's green card applications last month, alongside ongoing federal investigations into potential fraud and human trafficking within the H-1B and permanent labor certification framework.

According to the U.S. Department of Labor, six major firms have filed applications for roughly 3 million foreign workers since 2009, resulting in over 230,000 H-1B visa approvals and more than 100,000 permanent labor certifications.

The debate over foreign skilled workers in the U.S. remains deeply polarized. Critics argue that companies exploit foreign labor at lower wages to undercut American jobs, while industry groups maintain that foreign talent complements ongoing investments in local hiring.

Ultimately, while the temporary hold casts a shadow over the path to green cards for Indian professionals, the long-term impact on Indian IT services will depend on how long the suspension remains in place and what policy steps the U.S. government takes next.
Source: The Independent