The US Labour Department has suspended eight major IT companies from the Permanent Labour Certification, or PERM, programme, blocking new applications and pausing action on pending cases. The decision makes the green card process more uncertain for H-1B workers whose employers use PERM to advance permanent residency applications.

The companies named are Wipro, Infosys, Tata Consultancy Services, HCL, Cognizant, Microsoft, Adobe and Capgemini. PERM is generally the first mandatory step for most employment-based green cards. Under the process, an employer must establish that a qualified US candidate is not available and that hiring a foreign worker will not harm US wages or employment opportunities.

What the decision changes

The reported action is limited to PERM applications. The affected companies cannot submit new applications, while cases already in progress have also been paused. The report says H-1B engineers working for these companies do not face a direct immediate threat from this measure.

However, Indian IT companies have thousands of H-1B employees whose usual route towards permanent residence moved through their employers. The suspension therefore leaves their green card pipeline uncertain. It may also make long-term planning more difficult for companies running projects in the US.

The development comes as trade discussions between India and the US are described as stalled. No official response from the Indian government had been issued by late night, according to the report. The action follows a new one hundred thousand dollar H-1B fee and measures described as “Project Firewall”.

Administration's allegations

At a White House press conference, Vice President JD Vance and Labour Secretary Keith Sonderling accused the companies of taking US jobs through H-1B visas and green cards. Those statements were presented as allegations by the administration, rather than as a court finding.

The administration said the companies had submitted applications for about 30 lakh foreign workers since 2009. It also said the companies had received more than 2.3 lakh H-1B visa approvals and more than 1 lakh permanent labour certifications.

The administration claimed that these actions had taken hundreds of thousands of jobs away from US workers. The report does not provide an independent assessment of that claim.

Vance singled out Microsoft. He said the company had laid off about 6,000 US employees last year, while receiving about 6,300 H-1B visas and giving about 3,000 green card holders access to PERM. He also alleged that the company hired one and a half foreign “bonded” workers for every US employee who was laid off.

Wider scrutiny

Vance also said that Harvard, Yale and Stanford were among nine universities being investigated. The allegation is that the institutions were bringing international students to the US to reduce American wages.

Brown, the University of Pittsburgh, the University of California, Davis, the California Institute of Technology, Arizona State University and MIT were also identified as being within the investigation's scope.

The reported suspension could affect the long-term immigration planning of the named IT companies and their H-1B employees. The report also raises the possibility of consequences for India's IT services exports, although it does not provide a confirmed estimate of that impact.

Conclusion

The US administration has halted new and pending PERM activity for eight named IT companies, creating uncertainty around employer-supported green card applications while leaving H-1B engineers without a direct immediate threat under the reported measure.

Frequently Asked Questions

Q. What is PERM?

PERM is the Permanent Labour Certification process and is generally the first mandatory step for most employment-based green cards.

Q. Which companies were named?

The named companies are Wipro, Infosys, Tata Consultancy Services, HCL, Cognizant, Microsoft, Adobe and Capgemini.

Q. What has been suspended?

New PERM applications will not be accepted, and action on pending applications has been paused.

Q. Does the measure directly threaten H-1B engineers?

The report says H-1B engineers at the affected companies do not face a direct immediate threat from this action.

Q. What must an employer establish under PERM?

An employer must establish that a qualified US candidate is unavailable and that hiring a foreign worker will not harm US wages or employment opportunities.

Q. Which universities were mentioned?

Harvard, Yale, Stanford, Brown, the University of Pittsburgh, the University of California, Davis, the California Institute of Technology, Arizona State University and MIT were mentioned.

Q. Has India's government responded?

No official response from the Indian government had been issued by late night, according to the report.