Why Has the US Suspended TCS, Infosys and Other IT Firms From PERM?

Mumbai | 9 October 2026 

The Permanent Labor Certification Program lets US employers sponsor foreign workers for permanent residency, known as a green card. On 8 October, US Secretary of Labor Keith Sonderling suspended several large information technology (IT) outsourcing firms from the programme. 

“I am hereby suspending from the Permanent Labor Certification Program some of the largest IT outsourcing firms in the world,” Sonderling said. 

What Is PERM? 

PERM, or Program Electronic Review Management, is the system employers use to obtain labour certification before sponsoring a foreign employee for an employment-based green card. The employer files on the worker’s behalf. Before filing, the employer must get the standard wage for the role confirmed and complete the required hiring steps. 

The process aims to show that hiring a foreign worker permanently will not harm the jobs, wages or working conditions of US workers. PERM is different from the H-1B visa. 

• The H-1B is a temporary work visa for foreign professionals in speciality occupations. 

• PERM is part of the process for getting permanent residency. 

Which Companies Have Been Suspended? 

The suspension covers six IT outsourcing firms and two US technology companies. Sonderling said the department “will not accept any new or process any pending permanent labor certification applications involving these companies.” The US had already suspended Cognizant’s PERM filings on 9 September. 

Sonderling said Microsoft and Adobe were suspended due to multiple active federal investigations. 

TCS said the suspension was unlikely to affect its workforce strategy or customer engagements. The company said its PERM applications had been in single digits over the past two years. It also reiterated plans to hire an additional 15,000 employees in the US over the next five years. 

Why Did the US Take This Action? 

The administration has cited alleged fraud and says these companies hired foreign workers at the cost of American workers. Sonderling said the named companies had requested almost 3 million foreign workers since 2009. “They’ve received over 230,000 H-1B visa approvals, and over 100,000 permanent labour certifications,” he said. 

US Vice President JD Vance said the H-1B programme “has become rife with fraud.” He said Microsoft laid off 6,000 American workers last year while benefiting from 6,300 H-1B visas and almost 3,000 green cards. 

Attorney General Todd Blanche said the action sends a signal that “the Trump Administration will not tolerate discrimination against American workers.” 

How Does This Affect Indian Workers? 

Employees of these firms whose green card process has not reached the PERM stage now face delays. They cannot make fresh PERM filings while the suspension is in place. This means they cannot secure a priority date, which generally marks a worker’s place in the green card queue. 

The delay matters more for Indian workers because of existing backlogs and rules. 

• The US State Department’s September 2026 Visa Bulletin listed the employment-based second preference (EB-2) category for India as “unavailable” for final action. The EB-3 final action date was 1 January 2014. 

• The US caps the number of employment-based green cards available to nationals of any one country. 

• Certain H-1B holders can extend their stay beyond the usual six-year limit if a labour certification was filed early enough. Workers nearing this limit face greater risk. 

How Has India Responded? 

India’s Ministry of External Affairs (MEA) said in a statement on 8 October that it was closely monitoring developments. It said Vance’s description of foreign workers as indentured servants was “unwarranted and deeply offensive.” The ministry called Indian professionals highly skilled contributors to the US economy, innovation and research. It said talent mobility benefits both countries. 

The MEA acknowledged that the move could affect eligible employees’ green card applications. It clarified that the suspension does not automatically affect existing H-1B visas or the status of visa holders and their dependants. 

Outlook 

Vance said the administration wants companies to keep growing in the US. “We want you to continue to grow and to employ a lot of people, but we want you to employ American workers,” he said. 

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