The US government has suspended Microsoft from the Permanent Labor Certification Program (PERM), the process most employers must clear before sponsoring a foreign worker for a Green Card. Vice President JD Vance and Labor Secretary Keith Sonderling announced the move at a press conference in Washington on October 8, and the Labor Department will now neither accept new PERM applications from Microsoft nor process the ones already pending.Vance singled out the company as the worst offender. “There has been no company in the United States, unfortunately, that has abused the system more than Microsoft,” he said, claiming Microsoft laid off around 6,000 American workers last year while employing 6,300 people on H-1B visas and securing nearly 3,000 Green Cards. Microsoft has pushed back, saying the vast majority of its US employees are Americans.
A Vance-led fraud probe is behind Microsoft’s PERM suspension
The suspension follows an investigation by an anti-fraud task force that Vance chairs. Officials argued that PERM is meant for roles needing “hyper-specialized” skills that are hard to find in the US, and accused Microsoft of misrepresenting its needs to replace American staff with cheaper foreign hires.“The H-1B visa is how the people get into the United States in the first place, and then a PERM program is how those employees stay,” Vance said. He also claimed that for every worker Microsoft laid off, it brought in “one and a half foreign indentured servants.” Sonderling said Microsoft was suspended “due to multiple active federal investigations.”Microsoft is the largest filer of PERM applications, according to Labor Department data, so the freeze puts a sizeable pipeline of employee Green Card cases on hold.
Microsoft says most of its H-1B filings were for existing employees
Microsoft responded with a blog post on Thursday. It said about 80% of the roughly 6,000 H-1B applications it filed in the last fiscal year were to extend or change the status of existing employees, not to hire new people. The rest were for people already living legally in the US, and they make up only 1% of its US workforce.“Microsoft only files H-1B petitions for those who meet the rigorous standards of this visa category,” the company said. It added that its H-1B wages are among the highest of all filings, and that these employees are paid the same as anyone else doing comparable work.Data from Levels.fyi places Microsoft fourth among H-1B sponsors this year, with 21,706 petitions at a median base salary of $180,710. The company also said in July it would cut 4,800 jobs, or about 2.1% of its global workforce.
Vance says the Microsoft suspension will last “as long as it needs to”
Vance did not spell out what Microsoft must do to regain access to the programme. “Our message to Microsoft is not that we want to harm your company, it’s that we want your company to thrive, but we want it to thrive by employing and empowering your fellow Americans,” he said.The timing stood out. Hours later, President Donald Trump was due to present Microsoft CEO Satya Nadella with the National Medal of Technology and Innovation, the country’s highest honour for tech achievement. Just over a week earlier, India-born Nadella, who joined Microsoft in 1992, sat two seats from Vance at a White House luncheon on AI.The move extends a wider crackdown on skilled-worker visas ahead of the November midterms, which last September brought a one-time $100,000 fee on new H-1B petitions. For Microsoft employees already in the queue, the wait was long to begin with: PERM applications took an average of 336 days to process in August. Now it has no end date at all.
