Companies · · 2 min read
US bars Microsoft and Adobe from green card program in hiring crackdown
The Labor Department suspended Microsoft, Adobe and several IT outsourcers from a key green card sponsorship route, widening the administration's push against foreign hiring.
The short answer
The US Labor Department said it will stop processing new Permanent Labor Certification applications, a key step toward employer-sponsored green cards, from Microsoft, Adobe and IT firms including Infosys, Tata and Wipro. The Financial Times (FT) reported the move as a ban on Microsoft sponsoring foreign workers for residency. It raises hiring and compliance risks for tech and outsourcing companies.
What’s going on here?
Labor Secretary Keith Sonderling announced on Thursday that Microsoft and Adobe were being suspended from the department's Permanent Labor Certification program because of multiple active federal investigations, CNBC reported. New filings from IT services groups including Infosys, Tata, Wipro, HCL, Cognizant and Capgemini will also be refused. The Financial Times (FT) described the step as part of the White House's latest effort to limit immigration, affecting several tech groups. Vice President JD Vance criticized Microsoft over its 2025 layoffs. Microsoft said most of its US employees are Americans and that 80% of its roughly 6,000 H-1B applications last fiscal year were for existing staff.
What does this mean?
Permanent Labor Certification is the step where an employer shows the government that hiring a foreign worker for a permanent role will not hurt American workers. For many skilled employees already in the US on temporary H-1B visas, it is the gateway to a green card. Blocking new applications does not cancel existing visas, but it stops these companies from starting the residency process for staff who want to stay long term.
For Microsoft, the direct business effect may be limited in the short run. Its H-1B petitions numbered 21,706 in 2026, according to Levels.fyi data cited by CNBC, and those temporary visas are a separate program. The bigger risk is for retention: workers who cannot get on a path to permanent residency may be more willing to leave for employers that can sponsor them, or for other countries.
The outsourcing names on the list, such as Infosys, Tata, Wipro, HCL, Cognizant and Capgemini, rely heavily on moving skilled staff to client sites in the US. Sonderling said the group of suspended firms has sought close to 3 million foreign workers in total since 2009 and received over 230,000 H-1B approvals. Any further tightening could raise their costs or push more work offshore.
The timing matters too. The announcement came weeks before November's midterm elections, at the same summit where Satya Nadella, Microsoft's India-born chief executive, was among several immigrant tech bosses set to receive a National Medal of Science from President Trump. That mix of honoring individual immigrant founders while restricting company sponsorship signals that hiring policy could stay unpredictable for employers.
The bull case
The suspension covers only new applications for one program, not existing H-1B visas, so near-term operations at Microsoft and Adobe may change little. Vance said the administration wants to keep a good relationship with Microsoft, suggesting the ban could be lifted if the company changes its hiring practices. Companies may adapt by hiring more locally or expanding abroad.
The bear case
Losing the ability to sponsor green cards could make it harder to keep and attract top engineers, especially in competitive AI roles. The reference to active federal investigations adds legal uncertainty for Microsoft and Adobe. For IT outsourcers that depend on US visas, the move hints at broader restrictions that could raise labor costs and squeeze margins.
Why should I care?
For markets:
Indian IT services firms with US-listed shares, such as Infosys, Wipro and Cognizant, look most exposed to stricter foreign hiring rules. For Microsoft and Adobe, the effect is more about talent retention and legal risk than near-term revenue.
The bigger picture:
Immigration rules shape how tech companies hire and what their labor costs are. Policy shifts like this can feed into the profits of companies held in many retirement and index funds.
Market impact
| Asset (ticker) | Potential direction | Timeframe | Confidence | Reason |
|---|---|---|---|---|
| Microsoft (MSFT) | ↔ neutral | Long term | Low | Green card limits may affect retention, but core revenue is unlikely to change soon. |
| Infosys (INFY) | ↓ bearish | Long term | Medium | Outsourcers depend on US work visas and face stricter foreign hiring rules. |
| Cognizant (CTSH) | ↓ bearish | Long term | Medium | Suspension from the labor certification program could raise staffing costs. |
Potential impact, not investment advice.
Frequently asked questions
What is the Permanent Labor Certification program?
It is a Labor Department process in which an employer certifies that hiring a foreign worker for a permanent job will not harm US workers. It is usually the first step toward an employer-sponsored green card, so suspension stops a company from starting new residency cases.
Why was Microsoft suspended from sponsoring green cards?
Labor Secretary Keith Sonderling said Microsoft and Adobe were suspended because of multiple active federal investigations. Vice President JD Vance criticized Microsoft over its 2025 layoffs. Microsoft said most of its US workers are Americans and that most of its H-1B applications were for existing employees.
Does this affect H-1B visas?
The suspension applies to new Permanent Labor Certification applications, which lead toward green cards, not to the separate H-1B temporary visa program. However, the Labor Department cited the companies' heavy past use of H-1B visas in justifying the move, CNBC reported.
Sources: Financial Times, CNBC
