The notice arrived without fanfare, and it landed on two of the most valuable companies in America. On October 8, the U.S. Department of Labor suspended Microsoft and Adobe from the PERM program, the labor-certification system employers use to sponsor foreign workers for permanent residency. Six other companies were suspended alongside them: Cognizant, Infosys, Capgemini, Tata Consultancy Services, Wipro and HCL.
The department was blunt about why. Microsoft and Adobe were flagged, it said, because multiple federal investigations into the two companies have not yet concluded. The labor secretary attached a set of figures that framed the whole action: the eight firms had together petitioned for nearly 3 million foreign workers since 2009, and had won more than 230,000 H-1B visa approvals and over 100,000 permanent labor certifications in that span.
The suspensions sit inside a broader squeeze. The Trump administration has been tightening immigration and employment rules in the weeks before the midterm elections, and large technology employers, among the heaviest users of skilled-worker visas, have become an inviting target. Microsoft and Adobe did not respond to requests for comment.
PERM is the first gate on the road to a green card. Before a company can sponsor a foreign national for permanent residency, it must run a labor-market test: advertise the job, interview American applicants and certify that no qualified U.S. worker was available. The process is slow and costly, but it is the standard route for keeping an engineer or researcher in the country for good.
Losing access does not stop Microsoft or Adobe from hiring American workers, nor from sponsoring temporary H-1B visas. What it cuts off is the permanent-residency pipeline, the mechanism that turns a valuable foreign hire into a lasting one. For companies competing over a thin pool of AI researchers, chip designers and machine-learning engineers, that pipeline matters.
The suspension list tells its own story. Cognizant, Infosys, Tata, Wipro and HCL are India-based IT-services firms whose business depends on moving large numbers of engineers onto client projects; they dominate the H-1B rolls year after year. Capgemini, a French consultancy, runs the same playbook. Microsoft and Adobe are different creatures, product companies that sponsor relatively few visas but rely heavily on the foreign-born specialists they do bring in.
For Microsoft, the timing is uncomfortable. The company has spent years pouring money into AI, and its research and cloud divisions lean on researchers hired from abroad. Adobe faces a similar constraint across its engineering and machine-learning teams. Neither company can easily replace that talent with domestic hires on short notice.
The administration has cast the action as enforcement, a way to protect American workers and hold employers accountable for the visa programs they use. People close to the technology industry read it as something else: a political signal aimed at Silicon Valley in the run-up to an election in which immigration has become a dividing line.
The real-world effects will surface slowly. A PERM suspension does not retroactively cancel pending applications, and companies can still file individual cases once the underlying investigations close. But the uncertainty carries its own cost. Sponsoring a green card already takes years, and an employer sitting under a Labor Department cloud faces a higher risk that cases stall, get audited or are rejected.
The wider message is that no company is too large to lose access. Microsoft and Adobe rank among the most valuable enterprises in the world, with legal and lobbying shops to match their scale. That they were suspended in the same breath as outsourcing firms suggests the administration cares less about the difference between a product company and a services firm than about the headline the move produces.
Whether the suspensions stick depends on the investigations the department has declined to describe. It has not said what the open inquiries concern, which agencies are involved or when they might conclude. Until then, two of America’s largest employers must operate without a tool they have used for years, and thousands of workers waiting on a green card will wait a while longer to learn whether their sponsor’s trouble becomes their own.
The episode also revives an old debate inside the industry about how dependent its workforce has become on foreign labor. For decades, technology companies have argued that the United States does not graduate enough engineers to fill their needs, and that the visa system is a bridge to global talent. Critics have countered that the programs let employers undercut domestic workers and lock foreign staff into long sponsorship timelines. A suspension aimed at Microsoft and Adobe hands the critics a fresh, high-profile example to cite, whatever the investigations eventually find.
The suspension also differs from the visa bans the administration has floated. Losing PERM standing is not an immigration order, and it does not affect a company’s ability to sponsor H-1B visas, which are temporary. But the two programs are linked in practice. For many foreign engineers, an H-1B is the first step toward a green card sponsored through PERM, and cutting off the second step weakens the first, because a worker weighing a job offer weighs the prospect of staying permanently as much as the salary.
