Microsoft Hit by Green Card Freeze as JD Vance Accuses It of Replacing US Workers With Foreign Hires

Microsoft has been suspended from a US labour-certification pathway used in the employment-based green-card process after Vice President JD Vance accused the technology giant of replacing American workers with foreign hires.

The Trump administration announced the action on 8 October, suspending Microsoft and seven other companies from the Permanent Labor Certification programme, known as PERM. Vance said Microsoft had laid off about 6,000 US workers while obtaining 6,300 H-1B visas.

Vance Links Microsoft Layoffs to Foreign Hires

The H-1B programme allows employers to hire foreign workers temporarily for speciality occupations. PERM is a separate Department of Labor process generally used by employers seeking to sponsor eligible foreign workers for permanent residency.

'There has been no company in the United States, unfortunately, that has abused the system more than Microsoft,' Vance said, according to CNN.

He also alleged that Microsoft had replaced each laid-off worker with one and a half 'foreign indentured servants'.

The numerical comparison does not, by itself, establish that the foreign workers replaced the employees who were laid off. H-1B filings can include extensions or changes of status for existing employees rather than applications for newly hired workers.

Microsoft Says Most Applications Concerned Existing Employees

In a statement published on 8 October, Microsoft said about 80% of the approximately 6,000 H-1B visa applications it submitted in the previous fiscal year were to extend or change the status of existing employees, rather than hire new people.

The company said the remaining filings concerned new employees already legally in the United States and represented only 1% of its US workforce. It also said its H-1B employees received the same pay as other employees doing comparable work.

Microsoft said the vast majority of its employees in the United States were Americans and that it looked forward to providing the administration with further information.

The statement set out the company's position on its immigration filings. Its figures were not independently verified for this article.

Eight Companies Suspended From PERM

US Labor Secretary Keith Sonderling said the Department of Labor would neither accept new applications nor process pending permanent labour-certification applications involving Microsoft, Adobe, Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL Technologies and Capgemini.

Microsoft and Adobe are technology companies, while the other six provide IT and technology services.

Officials cited alleged fraud in announcing the suspensions. The action does not, by itself, establish that the companies committed wrongdoing.

The administration did not announce an end date. Vance said the restrictions would remain in place 'as long as it needs to'.

The suspension concerns the labour-certification stage of green-card sponsorship, rather than a cancellation of existing H-1B visas. It prevents new and pending PERM applications involving the affected companies from moving forward.

Announcement Came Before Nadella Award Ceremony

The announcement came hours before President Donald Trump presented Microsoft chief executive Satya Nadella with the National Medal of Technology and Innovation.

The medal is the US government's highest honour for technological achievement. The ceremony took place later on the same day that the administration announced the PERM suspension and accused Microsoft of abusing the immigration system.

Nine Universities Face J-1 Visa Probe

The administration separately announced investigations into nine universities over alleged misuse of the J-1 exchange visitor programme, which allows foreign nationals to participate in approved educational and cultural exchange programmes.

The institutions are Harvard, Yale, Stanford, Brown, the University of Pittsburgh, the University of California, Davis, the California Institute of Technology, Arizona State University and the Massachusetts Institute of Technology.

Department of Labor Inspector General Anthony D'Esposito said subpoenas had already been served.

'We will investigate whether foreign influence, improper financial relationships, or visa abuse are compromising federally funded research,' he said.

Vance accused the universities of using J-1 visa holders to undercut the wages of American graduate students and researchers. Those allegations remain the subject of the announced investigations, rather than established findings of wrongdoing.

The university investigations concern the J-1 programme and are separate from the PERM suspensions imposed on Microsoft and the seven other companies.