Vance Suspends Microsoft and Seven Firms From Green Card Program, Igniting Legal and Diplomatic Backlash

Key points

• The Labor Department suspended Microsoft, Adobe, Cognizant, Infosys, Tata, Wipro, HCL Technologies, and Capgemini from the PERM program, halting new and pending green card applications.
• Vice President JD Vance claimed Microsoft replaced 6,000 laid-off workers with 6,300 H-1B visas and nearly 3,000 green cards, calling foreign hires 'indentured servants.'
• USCIS data shows two-thirds of Microsoft's H-1B approvals went to existing employees, while Amazon and Meta, the top H-1B sponsors, were not suspended.
• Immigration attorneys expect lawsuits challenging the suspension's legality, noting the Labor Department can only suspend employers for 180 days under current law.
• India's Ministry of External Affairs condemned Vance's 'indentured servants' language as 'deeply offensive,' citing historical colonial connotations.
• Microsoft stated 80% of its H-1B filings were for existing employees or those already legally in the U.S., and that it pays H-1B workers comparably to other employees.

Background

This action follows a September 2026 warning from Labor Department Inspector General Anthony D'Esposito about potential H-1B program overhauls and fraud investigations. It also follows Microsoft's recent layoffs, including 268 cuts in Xbox, and CEO Satya Nadella's controversial remarks about job reductions. The suspension occurred hours before Nadella received the National Medal of Technology and Innovation from President Trump, highlighting a stark contrast between the administration's praise and criticism of the same executive.

How outlets are covering it

CNBC and GeekWire emphasize the data discrepancy: Microsoft's H-1B approvals largely went to existing employees, while Amazon and Meta, which sponsor more new H-1B workers, were not suspended. Business Insider focuses on the legal and practical impact on individual workers, noting that some H-1B holders may face removal if they cannot extend their status, and that lawsuits are expected. Al Jazeera highlights the diplomatic fallout, particularly India's condemnation of Vance's language and the impact on the 1.25 million-person green card backlog, 79% of which consists of Indian nationals. Microsoft's response, cited across sources, disputes the fraud claims, stating most filings were for existing employees or those already legally in the U.S.

Why it matters

The suspension disrupts the green card pathway for thousands of foreign workers, many of whom have waited years for processing. It raises legal questions about the Labor Department's authority to suspend employers indefinitely, as current law limits such suspensions to 180 days. The move also intensifies political debates over immigration, with critics arguing it protects American jobs and supporters contending it unfairly targets skilled foreign workers and damages U.S. competitiveness. The diplomatic fallout with India, a major source of H-1B workers, could strain bilateral relations and impact tech industry talent mobility.

What to watch

Immigration attorneys expect lawsuits challenging the suspension's legality within weeks. Microsoft has stated it will provide additional information to the administration. The Labor Department has not indicated a timeline for lifting the suspension, with Vance saying it will continue 'as long as it needs to.' The impact on individual workers, particularly those near the six-year H-1B limit, will depend on whether they can secure extensions or alternative visa status. India may escalate diplomatic protests, and the administration may face pressure to clarify the scope and duration of the suspensions.