What just happened? Vice President JD Vance announced that Microsoft has been suspended from a federal program to encourage foreign workers to receive green cards. The government claims the Redmond giant abused the system by cutting American jobs. However, Microsoft defends that most visa applications were for people who already worked there.
The suspension affects the Permanent Labor Certification program, better known as PERM. Adobe, Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL Technologies and Capgemini are also affected. Labor Minister Keith Sonderling said officials would stop accepting new applications and processing pending applications from businesses.
— Sean Hannity 🇺🇸 (@seanhannity) October 8, 2026
PERM is a step toward many employment-based green cards, which require employers to demonstrate that qualified, willing U.S. workers are unavailable for a position. While the suspension blocks the path to permanent residency, it does not end the H-1B program and does not automatically cancel existing work visas.
“Our message to Microsoft is: You are a great American company, but you need to hire a great American workforce,” Vance said.
The vice president said Microsoft laid off 6,000 American workers last year while benefiting from 6,300 H-1B permits and nearly 3,000 green cards. He also claimed that about 1,000 of the 3,682 PERM applications were for positions that appeared to overlap with positions eliminated through layoffs.
Microsoft’s response was that 80% of the approximately 6,000 H-1B petitions filed last fiscal year involved existing employees.
“This was not about hiring new people,” the company said. “Microsoft succeeds as a global technology leader by building the best technology workforce in the world. We do this by strengthening this country’s talent pipeline, hiring American workers and attracting the best talent from around the world.”
Microsoft added that H-1B workers will be paid the same as colleagues doing similar work.
Proponents argue that foreign workers help U.S. companies staff skilled workers and compete for talent globally, while critics say the programs could undercut American wages and hiring.
Trump has targeted these programs before. In 2020, tech giants condemned his restrictions on temporary work visas, warning that they would hurt U.S. competitiveness. His administration ratcheted up the pressure in September 2025 by announcing a $100,000 fee on new H-1B applications, prompting major employers including Microsoft to warn affected employees against international travel.
No end date for the suspension has been announced. Vance said the length will depend on how long officials deem it necessary, while also pushing companies to change their hiring practices.
An example of very bad timing is President Trump awarding Microsoft CEO Satya Nadella the National Medal of Technology and Innovation just hours after the announcement.
