Thousands of Indian tech professionals waiting for American green cards woke up to worrying news on Friday. On Thursday, October 8, the US Department of Labor suspended eight major technology companies, among them Tata Consultancy Services, Infosys, Wipro, HCL Technologies, Cognizant and Capgemini, along with Microsoft and Adobe, from the Permanent Labor Certification (PERM) programme, the first step for most employer-sponsored green cards.
Labor Secretary Keith Sonderling announced the move alongside Vice President JD Vance, saying the department would not accept any new PERM applications, or process pending ones, involving these companies.
What is PERM and why it matters
For most foreign workers on an H-1B visa, the road to permanent residency starts with PERM. The employer must show the Labor Department that it could not find a qualified American worker for the role at the prevailing wage. Only after that labour certification is approved can the company file an I-140 immigrant petition with US Citizenship and Immigration Services, and only then does the employee join the long queue for a green card.
Because Indian nationals already face multi-year backlogs in the employment-based categories, any freeze at the very first stage can add months or years to an already long wait.
Why the US says it acted
The administration framed the decision as part of a crackdown on what it calls abuse of employment-based immigration. Officials cited alleged fraud and multiple active federal investigations, and accused the firms of relying heavily on foreign workers while laying off Americans. According to figures presented by the department, since 2009 the eight companies together sought nearly three million foreign workers, received more than 230,000 H-1B approvals and obtained over 100,000 permanent labour certifications.
Vance singled out Microsoft, questioning why it kept sponsoring foreign employees while cutting jobs in the United States. Microsoft responded that about 80% of its H-1B applications in the last fiscal year were extensions or status changes for existing employees rather than new hires. Statements from the Indian IT companies were not immediately available.
The action builds on an earlier step: Cognizant had already been suspended from PERM on September 8, 2026, in connection with an alleged visa-fraud investigation.
Key facts at a glance
| Announced | October 8, 2026 |
| Agency | US Department of Labor |
| Announced by | Labor Secretary Keith Sonderling, with VP JD Vance |
| Companies | TCS, Infosys, Wipro, HCL Technologies, Cognizant, Capgemini, Microsoft, Adobe |
| What is frozen | New and pending PERM labour certification applications |
| What is not cancelled | Existing H-1B visas and status |
| Duration | Not specified |
What it means for Indian employees
The first thing to know is what the order does not do. It does not cancel existing H-1B visas, and it does not stop these companies from employing foreign workers. Nobody loses their job or legal status because of this announcement alone.
What it does do is close, for now, a key route to permanent residency for people sponsored by these employers. Here is how different groups are likely to be affected, based on what has been reported so far:
- PERM not yet filed: New filings through these eight companies will not be accepted while the suspension lasts.
- PERM filed but pending: Applications already in the queue will not be processed, so these cases are effectively on hold.
- PERM already approved: Previously approved certifications are not automatically erased, according to immigration reports.
- I-140 already approved: Approved petitions with USCIS are reported to remain in place, which matters for priority dates and H-1B extensions beyond six years.
Anyone in the middle of the process should speak to their employer's immigration team or a qualified immigration attorney before making decisions such as changing jobs, since a new employer would usually have to restart PERM.
Why this is a big deal for India's IT sector
Indian IT services firms are among the biggest sponsors of skilled foreign workers in the US, and a large share of their American workforce is made up of Indian engineers. Green card sponsorship is also an important retention tool. A prolonged freeze could make it harder for these firms to keep experienced staff on long US projects and may push some employees to look at other employers or other countries.
What happens next
The Labor Department has not said how long the suspension will last or what the companies must do to have it lifted. Legal challenges and negotiations are possible, and more details could follow from the department's official notice. For now, Indian workers and their families will be watching closely for clarity on pending cases, and on whether the list of suspended employers grows further.
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