The Trump administration accused Microsoft Corp., Adobe Inc. and a half-dozen other companies of abusing a US worker visa program and suspended them indefinitely from a longstanding immigration initiative that’s served as a crucial talent pipeline for Silicon Valley and Wall Street. The suspensions, announced Thursday by Vice President JD Vance and Labor Secretary Keith Sonderling, also targeted information technology services giants Cognizant Technology Solutions Corp., Infosys Ltd., Tata, Wipro Ltd., HCL Technologies Ltd. and Capgemini SE. Those firms, either based in India or with large operations there, are often called outsourcers for their role offering contract IT work to other businesses.
At a briefing in Washington, Sonderling said there were multiple federal investigations under way into the use of a system that allows US employers to sponsor foreign workers for permanent residency. Vance singled out Microsoft, the world’s third most-valuable company, for what he characterized as exploitation of the program. Vice President JD Vance announces the suspension of an immigration program for multiple tech firms, including Microsoft Corp., alleging widespread abuse of a worker visa system.
Photographer: Aaron Schwartz/Bloomberg “There has been no company in the United States, unfortunately, that has abused this system more than Microsoft,” Vance said. In a statement, Microsoft defended its use of visa programs and said that it looked forward to providing the administration with additional information. Adobe and the Indian companies named by Vance and Sonderling didn’t immediately respond to requests for comment.
Shares of Microsoft fell more than 1.3% in New York trading Thursday, while Cognizant reversed earlier losses and was up more than 5%. American depositary receipts of Infosys turned positive after sharp initial declines, rising more than 1%, while Wipro was down less than 1%. Vance’s comments assailing Microsoft came hours before President Donald Trump honored the company’s chief executive officer, Satya Nadella, with a National Medal of Technology and Innovation at a summit in Washington intended to spotlight US scientific leadership.
Just last week, Nadella joined other tech industry leaders at a White House luncheon to discuss safeguards for artificial intelligence. Read More: Trump Secures $2.4 Billion AI Pledge as He Honors Musk, Huang “Microsoft is a great American company, and we have a great relationship with them, they do a lot of important things,” Vance said. “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.” The moves announced by Vance and Sonderling take aim at the Permanent Labor Certification Program, or PERM, which allows companies to sponsor a foreigner who has been working in the US under the H-1B and other visa holders to become a legal permanent resident, the first step to becoming a US citizen. Silicon Valley’s reliance on foreign workers has long been a flashpoint in the debate over immigration. Since Trump’s return to office last year, the administration has seized on those concerns and pressed tech giants to do more to train and hire US workers.
As part of that effort, Trump has moved to make it harder for companies to use H-1B visas to attract foreign talent, targeting a major source of workers for the industry. The changes have included proposals for $100,000 filing fees for most candidates and tightening the rules of how the H-1B visas are awarded in an annual lottery, giving priority to companies offering the highest salaries. In his remarks, Vance urged the US-based companies to shift their policies to employ more US workers.
“Stop defrauding the American worker. Stop importing an indentured servant to do a job that an American worker would happily do,” the vice president said. Read More: Harvard, MIT Face Visa Probes Amid US Crackdown on Global Talent The suspensions marked the latest move by the Trump administration to crack down on both legal and undocumented pathways to migration, an effort that’s narrowing a key path linking global scientific and engineering workers with US companies across a range of sectors.
In a nearly simultaneous announcement Thursday, the administration also said it had opened investigations into foreign exchange visa holders at nine top colleges including Harvard University, Stanford University and MIT. The sweeping fraud probe is focused on J-1 visas, which at universities are often held by international PhD candidates and visiting scholars. During the Thursday summit where Nadella was honored by Trump, the administration announced plans to inject more than $100 million into education programs for American researchers in science, technology, engineering and math.
The initiative seeks to boost the number of scientific researchers who are American citizens and reduce the reliance on foreign talent by companies and universities. Representative Pramila Jayapal, a Washington Democrat, faulted the administration’s decision and said that the PERM program has a clearly delineated process that’s designed to make it beneficial to the US economy and to ensure that it doesn’t take jobs away from American citizens. “You don’t fix a broken immigration system by taking a hammer to legal immigration,” Jayapal said in a statement.
“Targeting Microsoft or the PERM program in this way simply undermines legal immigration and weakens America’s ability to innovate.” Read More: Thousands of H-1B Visas Are Going to Middlemen Gaming the System Companies like Microsoft often use the H-1B program to bring in foreign workers and then help some of them remain in the country through the system. Through the third quarter of the 2026 federal fiscal year, which ended Sept. 30, Microsoft had filed about 1,680 such petitions for permanent status, according to Department of Labor data. In its statement following the suspensions, Microsoft said that of the 6,000 total H-1B visa applications it submitted in the most recent fiscal year, 80% were to extend or change the status of current company employees.
“These were not to hire new people. The remaining filings for new employees were for individuals already legally in the United States who decided to come work for us, and they equal only 1% of our U.S. Workforce,” the company said on its corporate blog .
The Trump administration said it would suspend an immigration program for multiple tech firms that allows foreign workers to obtain green cards, including Microsoft, alleging widespread abuse of a worker visa system. Ed Ludlow has more. Source: Bloomberg The Permanent Labor Certification Program is a major retention tool for Microsoft, which has a reputation for helping employees with work visas seek permanent legal status.
The Redmond, Washington-based company has long bolstered its US-based workforce with employees in the country on H-1B visas, as well as visas for intracompany transfers and recent university graduates. Outside the tech industry, Wall Street firms and telecommunications companies have also relied on the H-1B program through their use of IT contractors from staffing and outsourcing agencies. Staffing companies have developed a lucrative business recruiting programmers and other technology professionals from abroad and placing them with US clients.
Read More: Trump’s $100,000 H-1B Fee Draws Rare Rebuke From US Business In the first nine months of the 2026 fiscal year Microsoft was the fifth highest user of H-1B visas, with 3,688. The company trailed behind Apple Inc., Infosys, Tata Consultancy Services and Amazon.com Inc., according to H-1B employer data published by US Citizenship and Immigration Services. Over the last decade, Microsoft has used nearly 54,000 such visas, ranking fourth among the largest users, behind Amazon, Infosys and Tata, according to USCIS data.
For years, TCS and other Indian outsourcers were among the heaviest users of H-1B visas, regularly drawing fire for taking over the tech operations at major US companies and then bringing in temporary Indian workers at salaries below their American counterparts. But the Indian companies have pulled back in recent years in the face of political backlash and the Trump administration’s move to hike fees on H-1B visas to $100,000. Nasscom, a lobbying group that represents Indian IT services companies, said that many of those businesses have significantly reduced their dependence on H-1B visas, a shift that has translated into fewer requests for permanent status.
“While the decision affects a specific immigration pathway, Nasscom has consistently maintained that immigration and skilled talent mobility are two distinct issues and should not be viewed through the same lens,” the group said in a statement. Read More: H-1B Crackdown on Indian Workers Erodes a Texas Real Estate Boom Even though the tech industry has embraced Trump in his second term, due to policies that have sought to ease their tax and regulatory burden and draw investments to build out AI infrastructure, the administration’s immigration crackdown has been a sore spot. Curbing the flow of foreign researchers and scientists threatens to undermine US innovation and competitiveness in the long term, according to Ken Mahoney, president and chief executive officer at Mahoney Asset Management.
“The United States has spent decades establishing itself as the global leader in technology because of its ability to attract some of the brightest minds from around the world,” Mahoney said. “Restricting access to that talent could halt innovation possibly, and you never know who is out there coming up with big ideas that you lose access to.” (Updates with comment from Jayapal in 19th paragraph. A previous version was corrected to address an erroneous attribution.) --With assistance from Liam Knox, Sarah Frier, Meghashyam Mali and Erik Wasson. © 2026 Bloomberg L.P.
All rights reserved. Used with permission. Learn more about Bloomberg Law or Log In to keep reading: See Breaking News in Context Bloomberg Law provides trusted coverage of current events enhanced with legal analysis.
Already a subscriber? Log in to keep reading or access research tools and resources.
Source: Bloomberg Law News